Permanent TSB customers could receive up to €30m in refunds

Bank withdraws court appeals relating to fixed-rate mortgages

Some 2,000 mortgage customers of Permanent TSB could share in a refund of up to €30 million after the bank withdrew its Supreme Court appeals relating to cases involving four customers who wanted to switch out early from fixed-rate mortgages into trackers.

The bank, which is 99.2 per cent State owned, also faces being fined by the Central Bank of Ireland, which confirmed that it is “conducting an enforcement investigation” against PTSB.

The issue relates to four customers, who held two mortgages between them.

They broke the term of their fixed rates early and wanted to move to trackers in 2009/2010. Their contracts allowed for this at the expiry of the fixed term.

However, as they broke their fixed terms early, PTSB would not allow them to revert to cheaper tracker rates.

Review

The parties complained to the Financial Services Ombudsman, William Prasifka, who found that the bank had erred by not providing the customers with sufficient information about the consequences of breaking their fixed rate early.

The bank went to the High Court, which upheld the FSO’s findings in August 2012.

PTSB then appealed to the Supreme Court and the case was listed for February 16th.

It has now decided to withdraw the appeals and said it would review another 80 similar complaints the FSO had pending.

However, The Irish Times has learned that some 2,000 customers similarly affected could be due a refund of between €10,000 and €15,000 each.

PTSB said it was reviewing “how it had dealt with all cases of customers in similar positions” and that affected customers would be “advised in writing if they are to receive redress as soon as possible”.

Ciarán Hancock

Ciarán Hancock

Ciarán Hancock is Business Editor of The Irish Times

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