Compensation process started at NAB

By 9pm on Monday night, National Australia Bank was claiming most customers' payments which went AWOL following a core computer failure last week were available in their accounts.

But even 120 hours after the system first went haywire NAB was still trying to correct thousands of duplicated transactions, suffering from slower than usual website speeds and counting the cost of running full page advertisements in national newspapers to apologise to disgruntled clients.

Ironically, the bank's share price closed for the day up 1.29 per cent at A$23.53. Admittedly all the big four banks enjoyed a share price improvement (CBA rose 2.08 per cent and Westpac 1.89 per cent) but NAB's wasn't the smallest increment - that honour fell to ANZ with just 1.15 per cent.

The fact is that the big banks, and many of their shareholders, will see NAB's public relations disaster as a valuable circuit breaker stemming the public outcry over their interest rate rises ahead of the RBA's official rate rises. For the moment at least, all attention is off any banking industry review and on a core computer system that went kaput.

Despite the bank's best efforts, there remain, at time of writing, NAB customers who still have not had their mortgage payments deducted and remain concerned about the possibility of being slapped with late fees.

In its latest statement however, the bank stated: "NAB wants to ensure that our customers are not left out of pocket as a direct result of the delays which have occurred in recent days.

A process is being put in place to identify where NAB customers may have inadvertently incurred fees, interest or other charges from the bank as a direct result of these delays.

"We will proactively undertake this work over the coming weeks without the need for customers to contact or notify us."

It might however be necessary for customers to get in touch with other organisations if they are caught up in a payments cascade which has failed because of an NAB link somewhere in the chain.

For example, businesses reported that accounts due over the weekend had not been settled because their suppliers had no access to funds. This could lead to late fees being incurred several steps along the payment chain.

NAB said that if customers had been charged a fee or incurred a cost from another institution as a direct result of the delays, they could register on a specially established website, at www.nab.com.au/compensation. Customers may also call 13 22 65, the main NAB telephone number.

In its Monday statement, the bank claimed: "Delayed value exchanges from NAB to other banks have also been processed over the weekend, which means that other banks can process any salary or other payments to their customers which may have been impacted by the processing delay."

If there is a bright spot in the timing (just 26 sleeps from Christmas) it's that most businesses won't have to complete and pay their BAS instalments until February, leaving them with a decent margin of time to fix up any outstanding NAB problems.