News: CBA UPDATE 1-Australia's CBA ordered to pay $5 mln penalty in overcharging interest case

(Adds background, ASIC comment)

April 7 (Reuters) - Australia's securities watchdog said on Wednesday the Federal Court has ordered the country's top lender Commonwealth Bank of Australia (CBA) to pay a penalty of A$7 million ($5.36 million) for overcharging interest to customers.

In February, the federal court declared CBA had misled customers on more than 12,000 occasions between December 2014 and March 2018, with total overcharged interest exceeding A$2.2 million.

The court rejected CBA's submission for a penalty between A$4 million and A$5 million on grounds that its misconduct was serious and the frequency of misleading representations were significant, the Australian Securities and Investment Commission (ASIC) said in a statement on Wednesday.

ASIC had submitted to court that an appropriate penalty was A$7 million, it added.

"CBA's delay in remediating customers following this error was an aggravating factor in the court's determination of the penalty," ASIC Commissioner Sean Hughes said.

CBA did not immediately respond to a Reuters request for comment. ($1 = 1.3063 Australian dollars)