AIB customers in line for €61m interest refund on loan top-ups
AIB says it will refund €61m of interest paid by customers after they topped up personal and small business loans between 1999 and 2019.
Managers at AIB said the customers affected were never overcharged but the bank's paperwork should have been clearer in setting out interest rate terms when customers with an existing loan topped it up by taking on extra debt.
The bank has begun contacting customers. All personal loan customers are expected to be written to in July and small businesses will be contacted in September.
AIB chief executive Colin Hunt said the issue had been "self-identified" by the bank and customers were not overcharged.
"The money was owed to us on the facilities," he said.
However, because the standard of documentation was not at the level it should have been, the bank had decided to return the money involved to customers, he said. The Central Bank had been informed.
The bank declined to say how many customers are now in line for interest rate refunds, but chief financial officer Donal Galvin indicated the individual payouts are expected to be relatively modest.
AIB announced financial results yesterday showing reduced profits for the first half of the year.