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NLB, at the time the largest Slovene bank, offered a 5-year savings product with attractive interest rates for savers. However, in an environment of falling interest rates, the bank assessed that the saving contracts were no longer sustainable, and unilaterally started to reduce the contractual interest (thus breaching its own contractual terms). Approximately 40,000 consumers were affected by NLB’s malpractice.
The Slovenian Consumers’ Association (ZPS) started negotiating with the bank about the interest rates that were not paid out in full. In 2007 ZPS filed lawsuits on behalf of some consumers because the bank had offered consumers out-of-court settlements with a lower pay-out, which most consumers accepted. For 160 consumers, ZPS successfully continued with the legal proceedings and the bank was ordered to pay out the interest rates in full.
The judgment is an important milestone in enforcing consumer rights in the financial services sector, as it also affects the practices of banking services providers and providers of other financial services.