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The government will draw up a Code of Good Practice with regard to the bank refunds

The Cabinet is to organise a procedure to help banks to refund customers with the money they have overpaid due to mortgage floor rate clauses, following last week's decision by the European Court of Justice that full, retrospective refunds must be given.

Government spokesman Íñigo Méndez de Vigo announced after the last Council of Ministers meeting on 23 December that a Code of Good Practice would be approved at the final meeting of the year, so that financial entities could quickly refund the money to clients who had been affected by these clauses.

Although the government had originally argued that the relationship between banks and their clients was "private and personal", it now says its aim is to provide "security, tranquility and certainty" to help resolve the situation quickly.

Méndez de Vigo said that the government respects legal decisions and that the problems with floor rate clauses would not have occurred if the 2013 law to protect mortgage clients had been approved sooner.