The Podgorica Basic Court recently ruled in favor of clients, stating that banks can only charge the actual costs of loan processing and must not determine them as a lump sum. According to that verdict, it means that banks can charge only the actual costs their clients had during the loan processing and must clearly prove and present them to the client, and not charge unrealized costs as a fixed percentage of one percent of the loan amount. The Secretary General of the Association of Banks, Mr Bratislav Pejakovic, does not want to comment on the decision of the Podgorica court, but emphasizes that the basic question here is – who bears costs of the lawsuit? A client or a lawyer who accepts to take money after the client wins the case.
As for the bankers’ position towards this verdict, Mr Pejaković said: “We do not want to comment on the verdict itself, because there is a free judicial belief, but we are totally sure that in higher court instances, the verdict will be completely opposite to the one passed. First, this is a story from three years ago, so it’s surprising that now it’s interesting again despite the experience that gives banks the right to charge a fee for processing loan applications, both in the EU with which we harmonize legislation and in the region. It’s an international standard to charge a fee related to the organization, realization, supervision and collection of the subject loan in addition to the interest. All banks charge and establish relations with clients through contracts, and above all, the will of the lender and the borrower is harmonized, where each client is familiar with his/her liabilities and costs.“
On laws that enable charging of loan processing fees in banks, he noted: “I have already explained the media that banks are established according to the Law on Banks, while the Central Bank of Montenegro issues the license for operation and supervision of banks. We will agree that the banking system is the most organized part of the economic system of Montenegro, where all banks recruiting over 2.200 people pay all taxes and contributions properly. Banks adhere to all laws regulating operations, starting from the Law on Banking Operations to the Obligations Act, where Article 1168 defines the Loan Agreement, while Article 1169 in terms of form and content in paragraph three indicates that the Loan Agreement determines the amount, as well as the conditions for granting, using and repaying the loan. Then you have the Consumer Loan Act, which explicitly states that the total cost of the loan is interest, fees, taxes and other costs that the consumer is required to pay in connection with the loan agreement…”
Commenting on the EU’s and the region’s experience regarding this same matter, Mr Pejaković told: “Three years ago, when this was a burning issue, Serbia’s comments regarding a similar verdict were “It is obvious that the verdict in question creates legal uncertainty in resolving these cases, creates a negative climate towards banks and encourages unrealistic expectations.” The European Court of Justice, by judgment in case C-621/17 of 03 Oct 2019 resolved a legal issue raised by the Supreme Court of Hungary regarding the cost of loan compensation. The European Court of Justice has found that European Directive 93/13/EEC on unfair contract terms, although stating that a contractual provision on credit management costs should be clearly and comprehensibly drafted, does not require that provision to specify all services provided in exchange for subject fee.”
