It has emerged that a group of major high street banks have already paid £559m in refunds to customers who launched complaints about unauthorised overdraft charges.

The figures were revealed in the annual results of the majority of the banks that are currently involved in a High Court test case over the issue of whether the charges are fair or not.

However, it is believed that the true figure will be even higher as both Abbey and Nationwide Building Society refused to disclose how much they have refunded.

The biggest payout to customers was made by the HBOS group, which includes Halifax, which refunded a total of £122m.

Royal Bank of Scotland Group, which includes high street bank NatWest, has so far paid out £119m, while Barclays has reimbursed £116m and HSBC has refunded £115m.

Before the test case began, Lloyds TSB refunded £76m to customers while Clydesdale and Yorkshire Bank said claims and costs, as well as provisions for future administrative fees relating to the issue, totalled £11m.

The banks are currently waiting to see what the judgment from the test case will be, which may allow a ruling to be made on how much they can charge people who go overdrawn without having authorisation, or breach their agreed limit.

The seven banks, Nationwide Building Society and the Office of Fair Trading jointly brought the case in an attempt to settle the issue after consumers began to reclaim millions of pounds through the courts.

The case revolves around whether unauthorised overdraft charges come under the remit of the 1999 Unfair Terms in Consumer Contracts Regulations.

If the judge rules that they do, the court will then make a decision at a separate hearing over whether the charges are unfair and give guidance on what a fair fee should be.

The banks have argued that consumer contract rules do not apply to the charges and that, even if they do, the fees are not unfair.

They have been given permission to put any new or ongoing refund claims on hold until the outcome of the test case is known.

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