1. World Consumer Rights Day Consumer Justice Now: Call for Reform Association of Banks in Fiji – perspectives on mortgagee sales Chairman, Mr Adrian Hughes Friday 15 March 2013

2. Overview of mortgagee sales A mortgagee sale is when a bank undertakes recover action on a defaulting debtor by selling the mortgaged property. Mortgagee sales are only conducted as a last-resort step after a lengthy and transparent process. Every reasonable effort is taken to work with customers who are experiencing difficulty in making their repayments. There are very few mortgagee sales conducted in Fiji.

3. Steps in a mortgagee sale While the steps may vary from bank to bank, the following process is generally followed: Very few customers who receive a 1 st Collections Notice actually end up being served with demand. In most circumstances the bank and the customer are able to work together to ensure that they can meet their repayment obligations. Banks readily accommodate any customer proposals to remedy arrears within a mutually acceptable time period. TimeframeActivity 7 days in arrears1 st Collections Notice 15 days in arrears2 nd Collections Notice 30 days in arrearsService of Default Notice 60 days in arrearsService of Demand Upon expiry (7 days)Mortgagee Sale process begins

4. All parties have a role to play Both the customer and the bank have important roles to play. Banks understand that unexpected things can happen in life that will cause financial distress. Customers should speak with their bank as early as possible if experiencing difficulty making their repayments Banks can then take the time to understand their situation and help. BankCustomer Make proactive contact with customer if signs of distress evident Make contact with their bank as soon as possible Assess whether customer is eligible for disaster relief packages, repayment holidays etc Maintain communication Refer customer to care and support networks Provide update on financial position Provide advice on alternative banking arrangements Take responsibility and act to meet their obligations

5. Obligations of the mortgagee (the bank) Banks are committed to responsible lending practices. The mortgagee sale advertising and tender process is transparent and independent and usually follows these steps: 1.Security property is advertised 2.Tender is received 3.Tender is awarded according to market value against appropriate valuation 4.Preparation of offer letter to the successful bidder 5.Solicitors engaged and documentation completed and signed. Deposit received. 6.Settlement Banks acts under the broad principle to act in good faith and exercise reasonable care when exercising its of sale under a mortgage. Banks seek to achieve the best price available when conducting a mortgagee sale.

6. Application of mortgagee sale We believe the current process is the most efficient and effective way to achieve the best result for the customer. It is usually in the interests of the customer to sell the secured property as soon as possible. This will minimise accrued interest and other costs to achieve the best possible price. Providing the court with the jurisdiction to determine a mortgagee sale will only delay this process and increase legal costs – causing more financial hardship for the customer.