Lloyds Banking Group has accused the Competition and Markets Authority (CMA) of "obvious flaws" in its study on the banking sector. This comes after the CMA, a UK government department, responsible for preventing anti-competitive activities, criticised Lloyds in 2015 over its accounts being among the most expensive in the industry and for providing services that were "below average quality".
The London headquartered bank claimed that the regulator's report had overstated its cost of accounts by about 90%. "The CMA's current analysis is not accurate or robust and does not reflect the actual prices paid by customers, [and] its personal current accounts price estimates are unreliable," Lloyds said.
The bank added that the CMA should not rely on price estimates to either conclude the state of the banking industry or to discover new ways to increase competition. Lloyds also disagreed with CMA's point that its accounts were poor value for money. "The CMA cannot reach any conclusions on price versus 'quality'," the bank argued.
One of the key responsibilities of the CMA is to boost business competition. It ensures this by making various proposals on a regular basis such as putting a cap on monthly overdraft charges, promoting the switching of current accounts and informing customers of the cost and benefit of their accounts.
Lloyds stands to lose the most from this responsibility of the CMA as it currently has 25% of all UK current accounts with its Halifax brand of banks, which was earlier a building society, being among the most successful in luring new customers, according to The Telegraph.
This is not the first time the bank has had a tussle with the business regulator. It has criticised CMA's research for being "wholly unreliable" and "profoundly unsuitable" in the past as well. The CMA has denied the current accusations. "We consider our work to be robust, and we will continue to listen to submissions from the banks," the regulator said.