National Irish Bank has completed its internal inquiry into the overcharging of fees and interest and has found no evidence of orchestration by the head office, the bank executive heading the inquiry said yesterday.
Mr John Trethowan, project director at NIB, said overcharging at the bank "was not the problem it was blown up to be" when first disclosed in the media last year. He said the instances of overcharging found were not centrally orchestrated. "We found them more to be more "isolated shortcomings rather than anything else, and that is not to minimise the thing".
While the inquiry into the overcharging of interest was completed earlier this year, the inquiry into the overcharging of fees has only recently ended.
Mr Trethowan would not say what the final figure was for fees charged about which there might be question marks, but said it was "in the region" of the £130,000 figure arrived at for the overcharging of interest. It is understood the figure for fees is in fact higher than £130,000.
The inquiry covered all branches for the 12 years to April 1996, he said. Customers who were reimbursed were given three to four times the amount of fees or interest about which there was a query, and so the total reimbursed could be as high as £1 million.
Customers who received cheques were told acceptance of the payment would constitute "full and final settlement of all claims by you against the bank". Mr Trethowan said this was "normal business practice" and that the bank was naturally anxious to conclude the matter.
Although some customers had questioned the amounts returned to them regarding the overcharging of interest, no legal actions were being taken, he said. The cheques recently issued regarding fees were "coming through the system". "No writs have been served at all" in relation to last year's scandals.
The picture painted by the RTE reports last year on overcharging at the bank "is basically as bad as it got". Mr Trethowan said the "majority" of the problem was located in the five branches named in the RTE reports. "It was not an endemic thing across the bank and it did not carry forward from the early 1990s." The bank spent £5.75 million (#7.3 million) last year on the various inquiries currently under way into its practices, and expects to spend a further £3 million this year. "We have taken the allegations very seriously and put a lot of resources into" responding to them, Mr Trethowan said.
Last week the bank reported a 13 per cent drop in pre-tax profits for the half-year to March, to £14 million. Expenses jumped by 32 per cent to £29 million, partly as a result of the costs associated with the various inquiries.
Two High Court inspectors, Mr Tom Grace and retired Supreme Court judge, Mr John Blayney, are inquiring into the allegations of NIB overcharging, and the sale by it of unauthorised offshore bonds.
Mr Trethowan did not expect the inspectors' investigations to be completed until next year. He said they had full access to the work carried out by NIB itself and its findings. He would not discuss the inquiry into the sale of unauthorised bonds.
