Test calculations using specialised software are being carried out by the Office of the Director of Consumer Affairs on the interest charged on customer accounts selected from the main banks.
Details of the customers' accounts and the interest charged on them were taken during spot checks on a number of bank branches over the past few days. Software used by the accountancy firm, BDO Simpson Xavier will now be used to checks the banks' calculations. The firm was engaged by the Director of Consumer Affairs, Mr William Fagan, to assist in the investigation.
Mr Fagan met with accountants from BDO Simpson Xavier yesterday to assess the material which has been collected to date. "We will be going through material from audits down to individual customer's accounts," said Mr Fagan. Nothing of concern has been noticed as yet. A report is to be prepared for the Minister of State at the Department of Enterprise, Trade and Employment, Mr Tom Kitt, by Thursday next.
All the major banks, apart from National Irish Bank (NIB), have now been visited. Visits on building societies and other financial institutions will take place next week. All the institutions licensed to charge interest have written to Mr Fagan's office stating they are only implementing the agreed charges.
The Garda Fraud Bureau's investigation into the banks has now received over 300 complaints, approximately three-quarters of which relate to NIB.
Meanwhile, Northern Bank has said regular reviews of loan arrangements are made with customers after a former head of credit alleged that it was "a non-written rule" that customers whose credit status had improved, would not be informed of the availability of more competitive rates.
Northern Bank, which is owned by the same group as NIB, issued a statement yesterday saying "our emphasis on Relationship Banking means that we stay close to our customers and regularly review with them their financial arrangements".
A spokeswoman added that this could mean an interest rate reduction on a loan if a customer's circumstances had changed.
Mr David Jordan, who worked at Northern Bank's headquarters in Belfast for 13 years, said that if customers' business improved or they had good security, they could qualify for reduced interest rates. But if they did not say anything, "we didn't do anything about it", he told UTV's Insight programme on Thursday.
Mr John Canning, head of bank branching, said that a sense of perspective had to be brought to allegations of overcharging at two Co Armagh branches in the 80s. The bank has commissioned its own inquiry.
He added that Northern Bank was a different bank to NIB, operating in a different jurisdiction and under different regulations. Northern Bank has been owned by National Australia Bank Group since 1987. Its branches in the Republic were renamed National Irish Bank following the purchase from British Midland Group.
National Australia Bank's independent European Audit Team has been commissioned to investigate all internal audit reports dating back to the 1980s.
