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Bank of Ireland confirms additional 6,000 customers overcharged in tracker scandal

This brings the total number of impacted Bank of Ireland customers to 10,300.

Bank of Ireland's CEO Francesca McDonagh was called in to speak to the Finance Minister recently about the bank's progress in compensating customers.
Bank of Ireland's CEO Francesca McDonagh was called in to speak to the Finance Minister recently about the bank's progress in compensating customers.
Image: Leah Farrell

BANK OF IRELAND has confirmed an additional 6,000 of its customers were impacted by the tracker mortgage scandal.

The scandal saw all of the main banks in Ireland either denying customers a tracker mortgage product or charging them the wrong rate of interest. The final number of impacted customers is expected to be close to 30,000 once the Central Bank’s examination into the issue has concluded.

Today Bank of Ireland said it has made substantial progress with its redress and compensation scheme in the last two weeks and will be soon sending compensation offers to 4,300 customers it had already confirmed as impacted.

“These letters will also set out the range of options which are open to customers and the Bank aims to compensate all of these customers, subject to their agreement, by the end of this year.”

It also said it has continued to review whether further customers should be included in the compensation process and has “agreed to include an additional 6,000 accounts within the scope of the compensation scheme”. This brings the total number of impacted customers to 10,300.

‘Unacceptable failings’

Central Bank governor Philip Lane had recently told the Oireachtas Finance Committee that in the case of two institutions, customers had been told they were not impacted when the Central Bank believed they were. It had asked these lenders to go back and review these accounts again with a view to having them included in compensation schemes.

In a statement this afternoon, the Central Bank said that it had identified these 6,000 additional customers as impacted, but Bank of Ireland had previously disputed this.

“Bank of Ireland will now provide redress and compensation to these customers. The Central Bank is determined to pursue banks to include affected customers in the redress and compensation scheme. As the governor of the Central Bank has previously made clear, we will continue to challenge all lenders on disputed cases,” it said.

“This approach gets money back faster to people affected. We will continue to pursue lenders and hold them to account for their unacceptable failings by using all powers.”

‘Fair outcomes’

Bank of Ireland said it will ensure that all impacted customers who continue to have an open mortgage account will be returned to their correct tracker rate as soon as possible, and aims to compensate all these customers, subject to their agreement, as quickly as possible, starting before the end of 2017.

“It is the group’s objective to fully resolve the tracker mortgage examination review, and to take an approach which seeks to respect our legal and contractual commitments and also ensure fair outcomes are achieved for our customers, consistent with the customer centric culture the group aspires to.”

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This announcement comes just two weeks after Finance Minister Paschal Donohoe hauled in bank chiefs – including BOI’s Francesca McDonagh – to answer for the scandal and to commit to faster progress in paying back what they owe their customers. The country’s five main banks issued apologies after this meeting, with all but one (Ulster Bank) promising redress and compensation to impacted customers by the end of this year.

Today Francesca McDonagh said making progress on the tracker issues has been a top priority for her since she took up the role of Bank of Ireland’s CEO in October.

“The bank is also confirming today that c6,000 additional customers will be part of the compensation scheme. This now gives us a clear picture of the number of impacted customers. The compensation process is commencing, and our priority is to ensure that all impacted customers are compensated as quickly as possible.

“I believe that the way in which we address this issue will define the customer centric culture we aspire to at Bank of Ireland and this is why I have made resolving this issue my personal priority since joining the bank.

“I unreservedly apologise to all impacted customers for the financial loss and anxiety this has caused them and their families.”

Read: Margaretta D’Arcy tried to perform a ‘citizen’s arrest’ of AIB bosses over the tracker scandal>

Read: Sorry is too little, too late for tracker customers who suffered for years because of bank overcharging>

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