Friday 27 April 2018

Ulster Bank sets aside millions of euro for tracker redress

Ulster Bank
Ulster Bank
Charlie Weston

Charlie Weston

ULSTER Bank has set aside millions of euro to cover the cost of putting customers back on low-cost trackers and refunding them overcharged interest.

The bank made a provision of €206m last year to cover the costs of a mortgage redress scheme for customers who were denied a tracker, according to the bank’s latest statutory accounts.

The British-owned bank said in the past it had written to 1,800 residential customers who lost good-value trackers, but should not have had them taken.

These customers have since been restored to a tracker rate, but have yet to get a refund of overcharged interest, and compensation.

The bank has stated that it expects to find more tracker-loss cases as it continues to trawl through its mortgage book.

Ulster Bank prompted surprise when it set aside just €5m in 2015 to cover the cost of the redress scheme.

The Central Bank has ordered an industry-wide review of tracker mortgages.

Some 15 lenders are involved, with expectations that more than 15,000 mortgage holders will get trackers back.

People were denied a return to trackers when they fixed for a while, or it was not made clear to them they could lose the tracker when they opted for fixed rate.

And the liquidators of the Irish Bank Resolution Corporation (IBRC) said they have identified 50 customers who should have a residential tracker mortgage, but were denied one.

IBRC was created to wind down Anglo Irish Bank and the Irish Nationwide Building Society.

In an update, the liquidators said the examination of the mortgage book at IBRC is scheduled to be completed by the end of this month.

Meanwhile, a financial adviser who specialises in tracker-restoration cases has warned that many thousands of people could be disappointed at the results of the industry-wide tracker investigation.

Padraic Kissane said it was taking too long to resolve matters for affected customers and their families.

“I am calling it the ‘Tracker Waiting Room’ which is packed to capacity with thousands of affected customers waiting on their results. There is a major ‘don’t know’ aspect of the matter at present,” he said.

And Fianna Fáil finance spokesman Michael McGrath has called for independent oversight of the tracker probe.

Information he received in the Dáil shows that every single decision made by Permanent TSB’s Independent Review Panel has been to uphold the customer’s appeal in full or in part.

“This is essentially an admission that the correct decision was not made in the first place.”

He said the fact that some appeals have been upheld where customers lost their home directly as a result of being wrongly denied a tracker mortgage rate is truly shocking.

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