MBNA PPI Award “Interpretative” Calculations?

[GRUMPY OLD GIT]

How interesting, as I wrote a letter of complaint addressed to both Tony Boorman and Caroline Wayman who asked another FOS individual to respond on their behalf.

 

This individual with the exalted FOS title of, Head of Casework Teams is a Mr. Stephen Dickie.

To be frank, I am of the opinion that Mr Dickie does not have a 'dicky bird' about how the true calculations should be done, in order to bring MBNA PPI complainant customers back to the Status quo.

Instead of which he started banging on about going to the Independent Assessor - Ms Amerdeep Somal. But, I was not complaining about the level of service that the FOS had provided!

 

My concerns are the same as others here on this thread; PS10/12 Appendix 2; Example 6...

 

Further, I did NOT consistently make minimum payments; payments as marked 'M' on the MBNA spreadsheet.

 

I have not yet been allocated a FOS Adjudicator even after 18 months and many letters to both FOS & FCA.

They must be protecting this mammoth US Bank...

[Miaspa 2010]

Grumpy I’ll see what response I get from the FCA most likely something similar.

AC do you know what conditions 2.4, 3.5, and 3.6 are? The one I have is early on and doesn't have those conditions

Some of the time Whatis due appears to be paying the higher amount of the totals which has got me wondering about those conditions.

 

 

MBNA Terms and Conditions 12/00: T&C - 7750-1.9/14.9-06-01

 

1.4

the minimum payment shown on the statement will be:

(a) the lesser of:

(i) 2.25% of the Account balance as shown on the statement (subject to a minimum of £5); or

(ii) the total sumof all of the following: charges for Payment Protection Cover, interest charged on the statement, Fees, plus £5 or

(b) the Account balance as shown on the statement if less than £5;

except as mentioned in conditions 2.4, 3.5, and 3.6...

[angry cat]

Grumpy I’ll see what response I get from the FCA most likely something similar.

AC do you know what conditions 2.4, 3.5, and 3.6 are? The one I have is early on and doesn't have those conditions

Some of the time Whatis due appears to be paying the higher amount of the totals which has got me wondering about those conditions.

 

Sure do!

 

2.4

We may at any time allow you to omit all or part of a minimum payment during the payment holiday specified in a notice under condition 14. If we do this, we will charge interest as if no payment holiday had been allowed, and we will not extend the period within which payment must be made in order to avoid interest on Retail Transactions.

 

3.5

You must pay us immediately:

(a) any amount by which the Account balance exceeds the credit limit;

(b) the amount of any Transaction made in breach of this agreement; and

© the amount of any arrears under this Agreement.

 

3.6 all amounts outstanding under this Agreement will be payable on demand if:

(a) this Agreement ends;

(b) you fail to make a payment in full on or before its due date;

© you commit any serious or repeated breach of this Agrrement and, if the breach is remediable , it has not been remedied;

(d) a bankruptcy order is made against you, or you make a voluntary arrangement with your creditors or;

(e) you die

 

just on an aside; I have always viewed PPI payments as: 'Transactions'; PPI is a product of which was sold.

 

And, just to reiterate:

 

the MBNA ingeniously designed PPI/PPC was simply a purely for profit product and have noted that the monthly benefit; 3% of the balance will not be less than £10 or more than £1,000 was created in order to keep a claimant in debt to MBNA and not for any protection.

 

by Competition Commission May 2007: “MBNA was recently required by the US Office of Comptroller of Currency to increase the minimum monthly repayment on its credit card products to £25 to avoid negative amortization. (Neg Am) As a result, MBNA’s minimum PPI claim payment is in the process of being increased to 5% or £25, whichever is the higher (it currently stands at 5% or £10 to reflect the existing approach).

[Miaspa 2010]

Cheers for that AC, nothing on there that explains why Whatisdue is paying the higher of the two minimums.

 

Odd MBNA can pick and chose what minimum they like. Problem is you can only surmise they are the terms applied to W's card. But it gives a strong basis for arguing early minimums on W's card are incorrect.

 

Have to agree with you on the PPI AC it's all a way of keeping you in debt.

[whatisdue]

I have been busy last few days now the weekend is here I can give this more time miaspa the months you raised have serious flaws the payment of July 09 of 153.20 does not have a PPC payment on my statement though it shows an estimated interest amount on my June statement of 93.43 most important is the statement balance to this month of 5608.55 is not on the statements . I have the 153.20 to balance amount 5761.75 and then Sept 09 of 128.62 to 5705.23 a.Also I realize that this method is set for mins or full payments only as they put an assumed surplus redress when there is no reconstructed surplus payment to it which is a nonsense proven by surplus redress amounts staying the same on between min payments made. Once the adjudicator gets my statements for a full investigation I will go over these points in the meantime I appreciate your input and I hope others are finding things to use in their own case.

 

 

 

 

 

 

 

 

 

 

QUOTE=Miaspa 2010;4680702]This is how MBNA are working out the monthly associated interest see my early post 634 , the rate on the PPC should be the rate prescrided for purchases at the bottom of the statement. There minor rounding differences purely as we are only rounding to whole pence. I haven't finished the sheet as supposed to be doing tax returns.

 

 

31.07.09 has no interest charged on the original statement so there is no monthly associated interest, the formula doesn't work not sure if this is an omission from MBNA but check your statement.

 

 

Oh if you check your minimums from 30.09.09 they should be what you have paid plus the missing payment from 31.08.09.

 

 

Why does the calculation stop 31.01.13 it should run until todays date.

 

 

Can't copy and paste will attach PDF.

[whatisdue]

i have been busy last few days now the weekend is here i can give this more time miaspa the months you raised have serious flaws the payment of july 09 of 153.20 does not have a ppc payment on my statement though it shows an estimated interest amount on my june statement of 93.43 most important is the statement balance to this month of 5608.55 is not on the statements . I have the 153.20 to balance amount 5761.75 and then sept 09 of 128.62 to 5705.23 a.also i realize that this method is set for mins or full payments only as they put an assumed surplus redress when there is no reconstructed surplus payment to it which is a nonsense proven by surplus redress amounts staying the same on between min payments made. Once the adjudicator gets my statements for a full investigation i will go over these points in the meantime i appreciate your input and i hope others are finding things to use in their own case.

 

 

Also i forgot to mention the payments stop in january 13 as this is when the ppc was stopped by mbna after my claim was upheld by the fos

 

 

 

 

 

 

 

quote=miaspa 2010;4680702]this is how mbna are working out the monthly associated interest see my early post 634 , the rate on the ppc should be the rate prescrided for purchases at the bottom of the statement. There minor rounding differences purely as we are only rounding to whole pence. I haven't finished the sheet as supposed to be doing tax returns.

 

 

31.07.09 has no interest charged on the original statement so there is no monthly associated interest, the formula doesn't work not sure if this is an omission from mbna but check your statement.

 

 

Oh if you check your minimums from 30.09.09 they should be what you have paid plus the missing payment from 31.08.09.

 

 

Why does the calculation stop 31.01.13 it should run until todays date.

 

 

Can't copy and paste will attach pdf.

[Miaspa 2010]

Whatisdue can you scan the statements up that you have the issues on removing stuff you would prefer not to be seen.

[Miaspa 2010]

Response from FCA.

 

 

I thank you for your recent email regarding your concerns with the firm MBNA.

If you feel that MBNA have not worked out the redress correctly then the Financial Ombudsman Services is the correct organisation to look at your complaint as they hold dispute resolution powers that the Financial Conduct Authority (FCA) does not hold. As the impartial regulator the FCA cannot comment on or intervene in individual cases.

The Ombudsman service is operationally independent from the FCA so we cannot comment on any decision made by them. As the Ombudsman service is still looking at your case I suggest you wait for their decision. If you are unhappy with the decision the Ombudsman has made then you can still seek legal advice.

Further help and advice

You can also seek legal advice about your position from your local Citizens Advice Bureau. You can contact them on 08454 04 05 06.

You can also speak to the Money Advice Service as they can provide guidance on PPI. You can contact them on 0300 500 5000.

What we will do

If you have any relevant documents you can provided to us to show that the firm is not calculating redress as per the guidance in the Handbook. I can forward them onto the supervisory department within the FCA for this firm. Please be aware due to confidentiality restrictions they will be unable to provide you with the results of any investigation.

I hope this email has been useful to you.

And my follow up

 

 

 

Thanks for your email, I have attached a copy of the redress method used by MBNA, additionally I attach a copy of MBNA’s term and conditions.

 

 

 

 

The issue lies with MBNA’s use of a surplus redress column and restating payments as minimums when the terms and conditions state they are not, confirmed by the statements I have. Additionally restating payments as full when at that the time they were applied to the card balance they were not.

 

 

 

 

The method of calculation appears to have started in 2011-2012 and gradually been “refined” to the most recent build sheet I have seen my own V20 BO41. It appears from my own understanding that the method does not comply with PS10/12. MBNA are using DISP APP 3.8.2 to allow the variance in the method.

 

 

 

 

However, PS10/12 3.22 page 46

 

We consider that it is unlikely to be fair to customers to take such an approach where a

complaint involves multiple breaches or failings or where it is clear that the failing was

particularly significant for that customer. Consequently, we anticipate that such different

approaches are unlikely to be appropriate in the majority of cases and will be the “exception

not the rule” for firms when dealing with a complaint satisfactorily.

 

 

 

 

MBNA’s current policy appears to be using a variation of V20 BO41 on most calculations of PPI redress. In all the calculations I have seen using variants of V20 BO41 there has been manipulation of restated minimums and restated full payments.

 

 

 

 

The consumer then has to prove to the FOS that the restated fulls and minimums are incorrect. If indeed they questions MBNA’s method in the first place. No correspondence I have had from MBNA states the departure from the methods in PS10/12.

 

 

 

 

MBNA’s own press release in June 2014 states in respect of default fees.

 

 

 

 

“We are confident that our PPI redress is correct; we have considered our methodology carefully and in detail. Our confidence is reinforced through external independent reviews and advice which has supported the way we approach default fees.”

 

 

 

 

I have asked for copies of these independent reviews but no details have ever been forwarded.

 

 

 

[angry cat]

Response from FCA.

 

 

I thank you for your recent email regarding your concerns with the firm MBNA.

If you feel that MBNA have not worked out the redress correctly then the Financial Ombudsman Services is the correct organisation to look at your complaint as they hold dispute resolution powers that the Financial Conduct Authority (FCA) does not hold. As the impartial regulator the FCA cannot comment on or intervene in individual cases.

The Ombudsman service is operationally independent from the FCA so we cannot comment on any decision made by them. As the Ombudsman service is still looking at your case I suggest you wait for their decision. If you are unhappy with the decision the Ombudsman has made then you can still seek legal advice.

Further help and advice

You can also seek legal advice about your position from your local Citizens Advice Bureau. You can contact them on 08454 04 05 06.

You can also speak to the Money Advice Service as they can provide guidance on PPI. You can contact them on 0300 500 5000.

What we will do

If you have any relevant documents you can provided to us to show that the firm is not calculating redress as per the guidance in the Handbook. I can forward them onto the supervisory department within the FCA for this firm. Please be aware due to confidentiality restrictions they will be unable to provide you with the results of any investigation.

I hope this email has been useful to you.

And my follow up

 

 

 

Thanks for your email, I have attached a copy of the redress method used by MBNA, additionally I attach a copy of MBNA’s term and conditions.

 

 

 

 

The issue lies with MBNA’s use of a surplus redress column and restating payments as minimums when the terms and conditions state they are not, confirmed by the statements I have. Additionally restating payments as full when at that the time they were applied to the card balance they were not.

 

 

 

 

The method of calculation appears to have started in 2011-2012 and gradually been “refined” to the most recent build sheet I have seen my own V20 BO41. It appears from my own understanding that the method does not comply with PS10/12. MBNA are using DISP APP 3.8.2 to allow the variance in the method.

 

 

 

 

However, PS10/12 3.22 page 46

 

We consider that it is unlikely to be fair to customers to take such an approach where a

complaint involves multiple breaches or failings or where it is clear that the failing was

particularly significant for that customer. Consequently, we anticipate that such different

approaches are unlikely to be appropriate in the majority of cases and will be the “exception

not the rule” for firms when dealing with a complaint satisfactorily.

 

 

 

 

MBNA’s current policy appears to be using a variation of V20 BO41 on most calculations of PPI redress. In all the calculations I have seen using variants of V20 BO41 there has been manipulation of restated minimums and restated full payments.

 

 

 

 

The consumer then has to prove to the FOS that the restated fulls and minimums are incorrect. If indeed they questions MBNA’s method in the first place. No correspondence I have had from MBNA states the departure from the methods in PS10/12.

 

 

 

 

MBNA’s own press release in June 2014 states in respect of default fees.

 

 

 

 

“We are confident that our PPI redress is correct; we have considered our methodology carefully and in detail. Our confidence is reinforced through external independent reviews and advice which has supported the way we approach default fees.”

 

 

 

 

I have asked for copies of these independent reviews but no details have ever been forwarded.

 

 

 

 

Who on earth wrote that twaddle!?

 

We have already made a Mass Complaint to the FCA about MBNA...grrrr

 

And what do they think that CAB can do?

 

Both the FCA and FOS are NOT fit for purpose; incredible and stupid

[AfterMidnight]

" Re. AC - Who on earth wrote that twaddle!?"

 

 

Yup - boiler plate stuff, one of the downsides of having a computer ... is the ability to produce paragraphs of standard "approach" stuff (rubbish) at the touch of a template key or two.

 

 

The problem at FCA and FOS can be summed up as ... "Neither of us need to look at this, do we ... so we won't. Clever people at bank's tell us that PS10/12 ... actually grants licence for firms to do whatever they like for PPI redress ... so OK then, MBNA, sorry for asking, sir".

 

 

And neither appears to notice that this (understatement) ... seems perhaps a tad weak ...

 

 

AMN

[AfterMidnight]

Hmmm .. skinnyrib - if you are still on, what was the version number of your November 2011 calculation?.

 

 

I am thinking about the very valid point raised of what would our "dubiously inventive" (post-mid-2012) calculations look like ... if they had been calculated as per earlier versions.

 

 

Skinnyribs headings are a bit different from those of V20_B022, (which are pre-invention of the extra columns). My own was VC20_B031: ( Attached shows all three headers.)

 

 

 

Would be interesting to do a little modelling or reverse engineering... of what claims might be if were calculated before using MBNA's internally approved earlier method(s) of the times - as in: "Well, Mr MBNA, are all equally correct, or was your earlier method flawed/overly generous/too much like respected Example 6 for your redress tastes ... ?"

 

 

May be one way of demonstrating to less-than-completely-informed adjudicators that not only are post-mid-2012 calculations a little different - but produce different results somewhat to earlier MBNA calcs. Wonder if that was within the scope of the two alleged and fabled independent evaluations that MBNA have previously banged on about ...

 

 

Monthly card interest can be calculated if (likely varying over term) the various APRs for the duration is known, I am though getting a little fed up that the onus is on us to prove anything and everything, in the face of calculations that are obviously different from standard practice ... but nobody at FOS (or FCA) seems to have checked or questioned that there could be a possibility, so maybe just worth checking, ... if they just may be unfair, in addition to being different.

 

 

Also - looking again at skinnyribs calcs, those (given monthly) interest rates vary so much that they cannot be straight contractual retail rates (that PPI was charged at) - looks ... like earlier misdirecting averaging of component-type buckets now to me ....

[Miaspa 2010]

I have a spreadsheet that already does that, it based on MBNA's current method but I can just delete the M or F and it re works the redress.

 

 

Its still a bit untidy, and not 100% accurate. MBNA throw to many manual adjustments at the calculation to get it working 100%. (See my earlier post on made up full payments.)

 

 

If I remove all the M's it a total redress of £7,196 remove the f's as well £12,418.

 

 

We then get to charges removing all these when the notional balance is negative pushes it up to £17,230K.

 

 

You then rework the interest to APR as per statements or transactions reports, not MBNA's monthly average £24,534

 

 

Do I get any of this redress? Nope! I'm doing it on Principle MBNA screwed me, I want Karma.

 

 

 

 

 

 

 

 

 

Hmmm .. skinnyrib - if you are still on, what was the version number of your November 2011 calculation?.

 

 

I am thinking about the very valid point raised of what would our "dubiously inventive" (post-mid-2012) calculations look like ... if they had been calculated as per earlier versions.

 

 

Skinnyribs headings are a bit different from those of V20_B022, (which are pre-invention of the extra columns). My own was VC20_B031: ( Attached shows all three headers.)

 

 

 

Would be interesting to do a little modelling or reverse engineering... of what claims might be if were calculated before using MBNA's internally approved earlier method(s) of the times - as in: "Well, Mr MBNA, are all equally correct, or was your earlier method flawed/overly generous/too much like respected Example 6 for your redress tastes ... ?"

 

 

May be one way of demonstrating to less-than-completely-informed adjudicators that not only are post-mid-2012 calculations a little different - but produce different results somewhat to earlier MBNA calcs. Wonder if that was within the scope of the two alleged and fabled independent evaluations that MBNA have previously banged on about ...

 

 

Monthly card interest can be calculated if (likely varying over term) the various APRs for the duration is known, I am though getting a little fed up that the onus is on us to prove anything and everything, in the face of calculations that are obviously different from standard practice ... but nobody at FOS (or FCA) seems to have checked or questioned that there could be a possibility, so maybe just worth checking, ... if they just may be unfair, in addition to being different.

 

 

Also - looking again at skinnyribs calcs, those (given monthly) interest rates vary so much that they cannot be straight contractual retail rates (that PPI was charged at) - looks ... like earlier misdirecting averaging of component-type buckets now to me ....

[AfterMidnight]

I have a spreadsheet that already does that, it based on MBNA's current method but I can just delete the M or F and it re works the redress.

 

Its still a bit untidy, and not 100% accurate. MBNA throw to many manual adjustments at the calculation to get it working 100%. (See my earlier post on made up full payments.)

 

If I remove all the M's it a total redress of £7,196 remove the f's as well £12,418.

 

We then get to charges removing all these when the notional balance is negative pushes it up to £17,230.

 

You then rework the interest to APR as per statements or transactions reports, not MBNA's monthly average £24,534

 

Do I get any of this redress? Nope! I'm doing it on Principle MBNA screwed me, I want Karma.

 

 

 

 

Know entirely where you are coming from. I guess most of us have an "alternative" version to that created by MBNA ... the two specific "alternatives" approaches to show to FOS that I am now thinking of maybe are: not allowing (because fabricated), the F&Ms, and/or alternatively simply calculating as per earlier MBNA versions - as two potential easy to understand and "authorised" alternatives - as opposed to our own created "competing" alternatives. Some example cases MBNA-alternatives previously submitted (to FOS and FCA) were created to precisely follow Example 6 of the Appendix of relevant guidelines to show a difference in end result. That was kind of side-stepped by Vicki's simple declaration of "that's just an example, not a requirement, and variations appear in some circumstance permitted under PS 10/12 by firms using their own calculations - so no further consideration necessary". While a number of us have tried to point out the hugely assumptive nature of this "off my desk" thinking, I am currently thinking thus:

 

 

We all demand all our recalculations to be redone by MBNA also on the previous basis (as a minimum for simply being for a comparison). Just run it through a V20, and give FOS and us the results, please. Nothing new here, but if we all ask same thing - there is at least a potential action that adjudicators and Vicki could foreseeably "do" as a possible suggested action, as opposed to just requiring deliberation or a decision that the parties are just entrenched so off the further delaying Ombudsman-level queue (without being investigated first). MBNA refusal to do so under any invented reasons ... may just start triggering the difference question to the front, while I for one would like to see MBNA's defence (if done and supplied) between very different results that would have been calculated a few months apart using different calculation methods. What could ..(rhetorical question here) ... possibly be the reason for change

 

 

AMN

 

 

If we can get MBNA on the defensive (MBNA stating their later method are better, for example) then the question will focus more on how are they more valid, and for whom are they better ...

[Miaspa 2010]

I see your point lets ask my adjudicator and see what happens!!!

[AfterMidnight]

I suspect I will do same, and may spend a little time reproducing earlier MBNA version(s) as a matter of interest (or use). I have an excellent "model" which follows Example 6 (and corrects it in a couple of places [Ex6 famously contains an arithmetical mistake], produced from elsewhere, and carefully explained in any necessary correcting steps, for which I very grateful).

 

 

But I do think a "here's how they did it before" case-specific MBNA calc may now be in order for our perhaps slow-to-see-out-of-the-box involved case handlers. Prior thinking of mine and a couple of others was that it was better complaining re. MBNA listed methods than knocking up an alternative something to lob into MBNA's court to pick apart for any small assumptions on my part (e.g. daily charging), but I think I have enough info on account rates to be able to model a V20 version calc.

 

 

Skinnyribs may be even better, but I would be wary of using something that was not a known V number (as in MBNA then saying to FOS "no idea where your deluded and misguided complainant got this from").

 

 

AMN.

[angry cat]

I suspect I will do same, and may spend a little time reproducing earlier MBNA version(s) as a matter of interest (or use). I have an excellent "model" which follows Example 6 (and corrects it in a couple of places [Ex6 famously contains an arithmetical mistake], produced from elsewhere, and carefully explained in any necessary correcting steps, for which I very grateful).

 

 

But I do think a "here's how they did it before" case-specific MBNA calc may now be in order for our perhaps slow-to-see-out-of-the-box involved case handlers. Prior thinking of mine and a couple of others was that it was better complaining re. MBNA listed methods than knocking up an alternative something to lob into MBNA's court to pick apart for any small assumptions on my part (e.g. daily charging), but I think I have enough info on account rates to be able to model a V20 version calc.

 

 

Skinnyribs may be even better, but I would be wary of using something that was not a known V number (as in MBNA then saying to FOS "no idea where your deluded and misguided complainant got this from").

 

 

AMN.

 

Good Luck, AMN & Miaspa;

the FOS & FCA have already had it explained to them in GREAT DETAIL...!

But, they refuse to see or listen -

I think we know why, don't we?

 

One question that should be asked is RE: Wheatley and Wayman:

What do they do all day?

Clearly they are NOT doing what they are paid to do - Regulate the Banks, their paymasters.

[suvin50]

The calculations for my complaint provided last November (posts #597/#599) don't seem to have the same headings as any of the versions in post #736. The monthly interest rates shown appear a bit iffy as well.

What is the formula for converting monthly rates to annual rates?

[dx100uk]

http://www.stoozing.com/calculator/apr-rate-converter.php

[suvin50]

Thanks for that dx

[AfterMidnight]

Hi Suvin, just to check>

 

 

Calculations sheets you supplied in earlier posts (renamed and reattached here for general convenience) were for calculations redone in Nov 2014 for an original 2012 calc, and attachments were supplied as is by MBNA without build numbers, so the 2014 re-calcs appearing more bespoke than an established redress build calculation. These were redone to now accommodate for a missed period, on your request, but MBNA said April 12 calcs contained an error which labelled some values (e.g.. if account sold or defaulted) as customer payments ... when not necessarily the case. So, have a very small increase stated MBNA.

 

 

Your original 2012 calcs presumably has headings much like V20_BO22 as appeared in attachment to #736 here. If you know the build number it may be useful for other people to potentially tie into different times when different builds were applied by the bank.

 

 

The recalcs do seem to effectively (it will be a database report, not a spread-sheet probably) have "columns hidden" that are needed to produce values even more than calculations that were common later in 2012.

 

 

And ... looking at these recalcs, you think that interest calculations/assumptions are dodgy, in addition to points Miaspa 2010 made about method and application at the time you posted these originally.

 

 

If you a have additional info, from statements or DSAR-obtained logs, on interest rates applying to your account - you may be able to compare with MBNA's "productions" of interest associated with PPI premiums, which is where you are coming from in your wondering ....

 

 

You may well find though that interest rates as published at or for the time bear little relation to those used in your calculation(s), as - for reconstruction - it is likely that it is a straight-ish arithmetical calculation uninfluenced by retail rates of the times was applied. This appears commonly to be the "grand total" of interest of the month, then apportioned to be allocated to PPI in a straight ratio of grand-total/PPI premium percentages. As observed previously, if everything on your account balance has the same rate ... little to complain about ... anything different ... and the difference over time can certainly mount.

 

 

Best of luck with your reverse engineering, others may comment a bit before you get to that, but if not and you subsequently need any more observations on the calculations themselves, ask away.

 

 

Generally: I can see a small library of versions coming together ... if anyone has not yet posted at least the headings and versions number of calculations, then doing so, if not already included, may be useful to others. As a minimum (to borrow another argument) it does as a minimum show that, for calculations, MBNA did not always and consistently calculate the same way over time ...

 

 

AMN

[suvin50]

I don't have any statements but do have a lot of info from the mainframe logs. I will trawl through them.

[Miaspa 2010]

Could try asking the adjudicator for the statements? MBNA will say they only hold the last seven years. If that's the case how can they defend any argument on restated minimums.

 

 

On your data base dump you will have changes in interest rates. You are looking for the purchase rates.

 

 

MBNA take the interest charged in the month and divide my the previous months balance. So random figures.

 

 

March 2014 Interest £100

February 2014 Balance outstanding £6,000

Monthly interest rate for March is 0.0166667 or 1.667 %

 

 

Hope that helps

[suvin50]

I have converted monthly rate to annual rate for 36 months and the annual rate varies from 11.48 % to 20.84 %. APR on original T&Cs was 18.9% for purchases.

[AfterMidnight]

I have converted monthly rate to annual rate for 36 months and the annual rate varies from 11.48 % to 20.84 %. APR on original T&Cs was 18.9% for purchases.

 

 

Usual reality pattern (purchase rates applied to PPI, regardless of what any reconstruction may claim) typically features a stepped pattern of increasing over time in announced jumps, as the bank decided they would rather make some more money on people with existing borrowings - as in at the time saying "live-with-it-sunshine, or repay it, at your choice".

 

 

Rates charged for PPI therefor reached dizzying heights of mid-thirties percentages expressed annually for some. MBNA, from recall, when I was sticking my logs under the microscope, in their logs refer (not very handily) to A, B1, C1 rates, etc. Safe enough-ish to assume that when different inexplicable rate changes appear on logs - that when they vary from each other they are: lowest one = promotional rates for balance transfers and special temporary deals / middle one = purchase, standard, retail, card rate / highest if different = cash machine withdrawals, transfers to current accounts. I have heard from other forum views that it can be said that PPI was them deriving you of money, so therefor you should have the highest "money" rate back: but since that didn't reflect reality - to me personally - that seems a bit of a demand above the simple "return to position" that seems just and fair.

 

 

The interest "apportion" method, when described as straightforward and commendable, in splendid isolation, by the bank - has the apparent appearance of seeming reasonable (to a casual inspecting party), and do-able regardless of perhaps lack of any specifics records.

 

 

My view is that if I have from the bank recent logs of historic rates that were applied - then the bank most certainly had/has those, and chose for a reason that made sense to them regarding they way they do it, not to use that information, for some reason that I couldn't possibly begin to fathom beyond vaguely-defendable simplicity if not necessarily fairness .. although the words "interest return minimisation" keeps coming to mind when thinking MBNA calcs, in addition to the becoming infamous "surplus redress step" and "MBNA shuffle".

 

 

My own (apparently little read, if at all by FOS) argued reasoning to FOS on the topic was that the banks own logs and Ts&Cs (and previous statements quoted written interest descriptions) showed PPI applicable rates as being, by default, the purchase rate - as that was described as "everything else not included in other descriptions". Also ... unusual account months of mine (that featured just brought-forward PPI figures), showed PPI charged at purchase rate (not an averaged rate) in the maths. This seemed to be ignored by FOS (and I have since pointed this out).

 

 

The maths of interest charged for any specific month does get fogged a bit by passed time, daily charging, payment time being different in month from statement time, and components of any balance consisting of accumulations of previous components and charges on that, and charges on those charges ... which is why simpler calculations such as Example 6 are better 'cos they use published rates, rather than derivations based on a multitude of other involved things. Hence PS 10/12 exists as guidance. MBNA using averaging ... in some ways this could be thought of as perhaps a similar "clean" argument - but in this case ... it can often end up being massively disadvantageous to customers ... and is a case of expediency (at absolute best) masking true return to position.

 

 

AMN

[Miaspa 2010]

I have converted monthly rate to annual rate for 36 months and the annual rate varies from 11.48 % to 20.84 %. APR on original T&Cs was 18.9% for purchases.

 

 

 

Can you scan those Terms and conditions and post them up here?

 

 

I can't find anything earlier than 2005 that's easily legible. Those don't refer to how payments are allocated.

 

 

There current policy is the amount subject to the highest interest rate is paid off first. I'm pretty sure it used to be the amounts subject to the lowest interest rate were paid off first but can't find any evidence of this.