AIB is conducting a comprehensive review of customer mortgage accounts with regard to tracker rates. The review is part of an industry wide investigation, required by the Central Bank of Ireland.

 

The review has found that we fell short on our obligations to some customers. This resulted in these customers being charged too high a rate of interest on their mortgage accounts.

 

We are taking certain steps to correct our failure depending on the individual customer’s circumstances, which include:

 

  • Writing to all customers who are affected.

  • Refunding customers who made overpayments and providing compensation.

  • Providing a payment towards the cost of independent professional advice.

  • Providing all customers who were affected with details of the independent appeals process.


These steps are in line with the principles outlined by the Central Bank, and key aspects of our work are reviewed by an independent third party, KPMG.

 

Our priority is to put things right for our customers who have been affected.

 

Prevailing Rate issue

Earlier this year we announced that we had made an additional provision, to cover the application of an FSPO decision on an individual tracker complaint to a wider customer group of c. 5,900 accounts. These customers had an option to choose a prevailing tracker rate at the end of a fixed rate period as detailed in their contract; and previously received a payment of €1,615 under the Tracker Mortgage Examination.  For further information on the application of the FSPO decision click here

 

Following intervention by the Central Bank, c. 300 of the prevailing rate customers, who rolled off their fixed rate very shortly after tracker rates were withdrawn on 10 October 2008, were reviewed and deemed impacted under the Tracker Mortgage Examination. We will write to these customers in August regarding both the Tracker Mortgage Examination issue and the FSPO decision. Payments to these customers will also commence in August 2020. Customers will receive the higher of the two payments, either the FSPO payment or the Tracker Mortgage Examination payment.

 

If customers have any queries in relation to the Tracker Mortgage Review, they can call our dedicated Helpline on 1800 235 460 (or +353 1 7715888) between 08:00 and 19:00, Monday to Friday.

Review of Tracker Mortgages – FAQ

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    How do I know if the review affected me?

    If your mortgage account falls into one of the below categories, it may have been impacted:

     

    • You were on a tracker interest rate and then moved to a different rate, for example a standard variable rate or a fixed rate.

    • You were on a tracker interest rate and your margin increased.

     

    Customers who were always on their correct tracker margin are not affected.

     

    If your account was affected, we will have written to you.

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    What if I have a question about the letter I received?

    We have a team of staff who are available to help you. Please ring our Helpline team using the contact details contained in your letter.

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    I am appointing a Third Party Advisor to assist me. Can I give you permission to deal with this advisor on my behalf?

    Yes. You will need to confirm in writing (through the approved “Third Party Advisor” form) that we can liaise with the advisor in relation to the Tracker Mortgage Review. You can find this form here or you can contact our helpline to request the form.

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    I received a letter.

    What can I do with my cheque?

    You can lodge your cheque. Lodging it will not affect your right to make an appeal, to make a complaint to the Financial Services and Pensions Ombudsman or pursue this matter through the Courts. You are not required to apply any of your payment amount to your mortgage account.

     

    Why did I receive a payment instruction form instead of a cheque?

    A payment instruction form is most frequently issued where there are multiple parties to a loan living at different addresses. We need you to complete this form so that we know how you would like us to split your payment.

     

    Personal representatives of deceased borrowers

    Where we were aware of the personal representative of a deceased borrower we also sent them a letter along with a payment instruction form. Click here for more about the identification documents that personal representatives need to provide before the cheque will issue to them.
     

    Do I have the right to appeal the redress and/or compensation?

    Yes, you have the right to appeal the actions we have taken to correct our failure. You should submit your appeal within 12 months of the date on the letter in which we provided full details of the redress and compensation payment.

     

    What can I appeal?

    You can appeal any aspect of redress and compensation within 12 months of the date on your letter in which we provided full details on the payment. Our decisions on the level of redress and compensation due to customers are based on the information available to us in our review of your account. As part of the appeals process you can include any additional material financial information which you would like to have considered.

               

    Who will hear my appeal?

    All appeals are heard by a fully independent appeals panel in accordance with the Terms of Reference and Procedural Rules of the appeals panel.

              For more details on the panel membership click here.

               

    How do I begin an appeal?

    Customers who received a letter providing detailed calculations of their redress and compensation payment can request an appeals application pack. To request this pack, please contact the helpline number provided in your letter. This pack will give you more details about the overall appeals process. Customers who decide to appeal will need to complete the appeal application pack and return it (together with any supporting documents relevant to their appeal) to the address set out in the form.

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    What if I did not receive a letter?

    If you did not receive a letter from us and have reason to believe your account may be affected, or if you have a question, please call our Helpline team on 1800 235 460 (or +353 1 7715888) who are available Monday to Friday between 8am and 7pm, write to us at AIB Tracker Mortgage Review, 10 Molesworth Street, Dublin 2, D02 R126 or visit us in your local AIB branch.

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Application of the FSPO Decision

The FSPO has made a decision in relation to a complaint where the customer did not have the option of choosing the then prevailing tracker rate at the end of a fixed rate period. This issue occurred between October 2008 and December 2013 when AIB had withdrawn tracker rates. 

 

Earlier this year we announced that we had made an additional provision, to cover the application of the FSPO decision on an individual tracker complaint to a wider customer group of c. 5,900 accounts. The rollout of this decision relates to a group of customers we have written to previously (when we wrote to affected customers in 2018 on this topic we provided a payment of €1,615).

 

The FSPO made an award on an individual FSPO complaint. The award is a 12% write down of the capital balance at the time the fixed rate period ended and a refund of interest charged on that 12% capital amount.    

 

Given other customers had similar terms and conditions and circumstances as this complainant, we have decided to apply the award given in this FSPO decision to these customers. The application of the FSPO decision is to provide a fair and proportionate remedy.

 

We have reviewed each account individually and calculated the balance adjustment and interest payment required in each case. This relates to reducing a mortgage account balance by 12% from the date the fixed rate period in question ended, refunding by cheque interest charged on that 12% capital amount during the intervening period and adjusting the repayments going forward given the capital reduction. Where accounts are closed the adjustment will be made by a cheque payment.

 

What will happen next? 

Customer accounts are currently being adjusted. During August, customers will receive written confirmation of the balance adjustment made on their account and a cheque for the interest refund due. 

 

If customers have any queries they can call our dedicated FSPO Mortgage Review helpline on 0818 300 070 (or +353 1 7715912) between 9:00 and 17:00, Monday to Friday.

FSPO Mortgage Review – FAQ

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    How do I know if the review affected me?

    We will write to you in July/August to let you know that your account is impacted and provide you with your payment under the FSPO decision.

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    What if I have a question about the letter I received?

    We have a team of staff who are available to help you. Please ring our Helpline team using the contact details contained in your letter.

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    I am appointing a Third Party Advisor to assist me. Can I give you permission to deal with this advisor on my behalf?

    Yes. You will need to confirm in writing (through the approved “Third Party Advisor” form) that we can liaise with the advisor in relation to the FSPO Mortgage Review. You can find this form here or you can contact our helpline to request the form.

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    Is the FSPO payment included under the Tracker Mortgage Examination, and can I appeal to the Independent Appeals Panel?

    No. The FSPO payment is being made outside of the remit of the Central Bank of Ireland’s Tracker Mortgage Examination Framework. The Independent Appeals Panel is set up under this framework and as such, does not apply to this payment.

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    What can I do with my cheque?

    You can lodge your cheque. Lodging it will not affect your right to complain to us or the FSPO, or take legal action in the Courts. You are not required to apply any of your payment amount to your mortgage account. 

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    What if I did not receive a letter?

    Customers who are affected by this issue will receive a letter on the topic before the end of August 2020.

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Allied Irish Banks, p.l.c. is an authorised agent and servicer of AIB Mortgage Bank u.c. in relation to origination and servicing of mortgage loans and mortgages. AIB Mortgage Bank u.c. is regulated by the Central Bank of Ireland.