Ok, the bank has refunded the difference (and I understand that they made their small print clearer now...). Still wonder how many other people "got taken" by this "policy" without knowing about it. I did ask the FSA whether rounding-up is standard industry practice. They sent me a VERY detailed and nice reply, but did not answer the question and instead refered me to the Banking Code Standards Board. Now, the BCSB also responded promprtly, but doesn't deal with mortgages anymore so they suggested the Financial Ombudsman Service. The Ombudsman deals only with unresolved cases, so I guess no one will look into this "practice"....

Interestingly, the Sunday Times had an article with quite a long list of "hidden mortgage cost" items yesterday. "Rounding-up" LIBOR rates was not mentioned, so either no one else ever checked and knows about it, or mine was a single case...