ASIC has announced that the Commonwealth Bank of Australia (CBA) has agreed to change advertised comparison rates for its Wealth Package loans in response to ASIC concerns the comparison rates used in ads were incorrect and potentially misleading.

ASIC was concerned CBA’s home loan ads promoting its Wealth Package loans did not include the Wealth Package $350 annual fee in the advertised comparison rate.

Section 166 of the National Credit Code and Regulation 100 require the comparison rate to include each fee or charge (if any) payable by the debtor at the time each repayment is made, being a credit fee or charge (other than a government fee, charge or duty) that is ascertainable when the comparison rate is disclosed (whether or not the credit fee or charge is payable if the credit is not provided).

A fee or charge is not ascertainable and need not be included in the calculation if their imposition or amount is dependent on events that may or may not happen.

The Home Loan Key Facts Sheets personalised comparison rate is based on the normal comparison rate calculation except for the loan amount and term nominated by the consumer and any other information required by a lender.