Victims of tracker mortgage scandal will grow, says Minister

Majority expected to receive redress and compensation by the end of the year

Minister for Finance Paschal Donohoe: “As to whether I expect the numbers to grow, the answer is ‘Yes, I do’.” Photograph: Gareth Chaney Collins

Minister for Finance Paschal Donohoe: “As to whether I expect the numbers to grow, the answer is ‘Yes, I do’.” Photograph: Gareth Chaney Collins

 

Minister for Finance Paschal Donohoe has said he expected the number of victims of the banks’ tracker mortgage scandal to grow.

He said he had been told by the Central Bank in a recent update there were about 13,000 impacted accounts at the end of September.

“As to whether I expect the numbers to grow, the answer is ‘Yes, I do’,” he added.

“That is why I was clear that a crucial piece of work, which needs to be done before Christmas, is to conclusively find out who has been affected.’’

The Minister was answering questions in the Dáil on the scandal whereby the banks either denied customers their right to a low-cost mortgage, linked to the ECB’s main lending rate, or applied the incorrect rate.

Mr Donohoe said some lenders had commenced payment of redress and compensation to impacted customers.

The Central Bank expected that all remaining lenders would have implemented their redress and compensation programmes by the end of the year, with the majority receiving what was due to them by then, he added.

‘Unacceptable failings’

“The Central Bank’s priority continues to be to ensure that lenders identify all customers affected by their unacceptable failings and they pay appropriate redress and compensation,’’ said Mr Donohoe.

“The Central Bank will continue to pursue lenders accordingly, in line with the framework of the examination.’’

He said the Central Bank would provide him with a further updated report in mid-December.

Fianna Fáil finance spokesman Michael McGrath said the scandal was growing arms and legs.

No consistency

He said there was no consistency across the various institutions when it came to compensation. For AIB, it ranged between 15 per cent and 30 per cent, Bank of Ireland a flat 10 per cent, Ulster Bank, 12 per cent for non-arrears and 13.5 per cent to 20 per cent for those in arrears, he added.

Permanent TSB seemed to be in the region of 10 per cent, he said.

Mr McGrath said the question of compensation should be entirely removed from the banks.

Sinn Féin finance spokesman Pearse Doherty said the compensation issue was not working.

“We have heard some testimonies showing it is not,’’ he added.

Mr McGrath said he believed this would be dealt with only through the courts unless there was action to set up some type of uniform redress scheme.