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Thursday 30 November 2023 Dublin: 3°C
out of patience

Taoiseach says banks' behaviour on tracker mortgages is 'scandalous'

Donohoe is calling in the bankers on Monday and Wednesday to “admonish” the chief executives.

Published at 2.30pm

BANK BOSSES ARE to be hauled in by the Finance Minister Pascal Donohoe next week to explain their behaviour in the tracker mortgage scandal.

Donohoe is calling in the CEOs of Bank of Ireland, AIB, Ulster Bank, PTSB and KBC on Monday and Wednesday to “admonish” them over their behaviour, said the Taoiseach today.

The scandal has seen thousands of customers in a number of financial institutions in Ireland charged higher rates of interest than they should have been or being refused the option of a tracker mortgage.

During Leaders’ Questions, Varadkar said the government believes the behaviour of the banks is “scandalous” and accused the banks of “dragging their feet” on the issue, which has resulted in a human cost that is impacting on people’s mental health.

“The government has lost patience,” he told the Dáil.

As a result, he told the House that Donohoe would be calling in the heads of the banks next week to explain their conduct throughout this scandal.

He said it his view that people should have had their trackers restored and be compensated by now.

Varadkar questioned why the Central Bank was acting so slowly and said he has urged them to move more quickly. He said Donohoe will be contacting the Central Bank to convey that message. He added that if the Central Bank feels they need more powers to deal with this matter, they should clearly say so.

The Taoiseach said he has not ruled out giving the Central Banks additional powers to deal with the scandal that has impacted some 13,000 customers, with some experts stating numbers could rise to 20,000.

If the government is not satisfied with the banks, it will take further action in the form of fines or sanctions, the Taoiseach told the chamber.

“It’s very much in the interest of the banks, their shareholders and staff to fix this problem, and fix it quickly,” the Taoiseach said.

The Taoiseach was replying to Labour leader Brendan Howlin, who said the slow movement by the Central Bank is not good enough, adding that people had been “ripped off to the tune of thousands of euro”.

Varadkar said he wanted the issue to be fixed quickly, and said all lenders must commence redress by the end of the calendar year.

The Central Bank report on tracker mortgages, which was published yesterday, said two lenders are undertaking further review work and are to submit addendums to their recent updates. It said it is challenging these two lenders to ensure this review work is completed without delay.

The names of the two banks which the Central Bank said fell short on their obligations have not been published, something Howlin questioned today. He said the names of the banks should be released to the public.

“I cant speak on behalf of Central Bank, but what they have told him is that they want to give the two lenders more time to get their act together. They are expecting a reply by the end of October, and if it is not satisfactory, their names will be published,” he said.

Howlin said there should be a definitive timeline given by the banks.

Varadkar said redress should be underway by the end of the year, but he agreed that a clear timeline is needed. reporter Michelle Hennessy will be on The Pat Kenny Show on TV3 tonight at 10pm talking about the tracker mortgage scandal.  

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