Lenders pay €78m for denying tracker rates to 2,600 customers

Central Bank identifies nearly 10,000 account holders affected by tracker issue

The Central Bank can fine lenders up to €5 million in relation to the tracker issue.

The Central Bank can fine lenders up to €5 million in relation to the tracker issue.


Some €78 million has been paid by lenders to 2,600 mortgage account holders in redress and compensation for being denied a tracker rate at some point over the past decade, the Central Bank said on Thursday.

In an update of its industry-wide tracker mortgage examination, which began in December 2015, the Central Bank said it expects the lenders to have identified all affected account holders by the end of September.

The Irish Times has learned that this redress and compensation figure excludes €5.8 million that was paid to 222 account holders of Springboard, a lender that was owned by Permanent TSB at the time of this failure.

It also excludes 1,374 PTSB customers who were identified as having been denied a tracker rate in mid-2015, before the Central Bank’s examination began.

PTSB, which is 75 per cent State-owned, is subject to a enforcement action by the regulator as a result of this issue, as is Ulster Bank.

Fines of up to €5 million could be imposed on the banks, and Springboard has already been fined €4.5 million for its failures. This fine was paid by PTSB, which sold on the Springboard mortgages some time ago.

Identify lenders

The financial regulator declined to identify the lenders who have paid redress and compensation to their customers, nor would it say how many had so far made payments.

The Central Bank’s latest update shows that some 9,900 affected customers had been identified by lenders by the end of February, up from the 8,200 accounts by December 19th last year. This is out of 100,000 mortgage accounts across the market that could be potentially affected by this issue.

This stage of the examination is the second phase of the process, with two more to follow. The overall process is not expected to conclude until well into 2018.

The Central Bank said it would issue its next update in the autumn, with a final report published at the conclusion of the examination. Some 15 lenders were included in the review, although not all of them have an issue.

The regulator said the immediate focus of its examination was to ensure that the interests of affected customers were protected and that lenders prioritise the identification of borrowers.

The Central Bank said it would take “appropriate supervisory action”, up to and including enforcement action to ensure that lenders deliver “fair outcomes” for affected customers.