In a move which should finally clarify the situation regarding bank charges, HSBC, Lloyds TSB, Royal Bank of Scotland and Nationwide have agreed to a test case to obtain a ruling as to whether current overdraft charges are illegal.  With the full backing of the above banks, the Financial Services Authority (FSA) have filed an action arguing that overdraft charges are unfair.

This situation with regards to the thousands of compensation claims which have been received by the banks has reached something of a stale mate.  Customers keep sending in their compensation claims, although the majority of the UK banks have now resorted to stalling tactics with many now unwilling to payout compensation - despite the industry as a whole paying out millions of pounds over the last few months.

While the banks continue to argue that their charges are not unlawful, they have recently been criticised by the Office of Fair Trading and a number of court judges, for their tactics used to pressure customers into dropping cases.  It appears that a stalemate has now been reached, something which the banks have been trying to avoid for months.  Their strong arm tactics of late have given the FSA the perfect excuse to try and resolve the issues once and for all - but who will win remains to be seen!

There may also be a number of internal working issues which the banks are unwilling to let the public see, something which may well hinder the defence of the banks when the issue finally goes to court.  It certainly promises to be a very exciting court case, with millions of pounds riding on the outcome.