AIB 'should add 6,000 customers' to tracker mortgage bill

A mortgage rights campaigner has called on the newly-appointed AIB chief executive to add 6,000 customers to its tracker mortgage redress and compensation scheme.

Brendan Burgess of Askaboutmoney.com claims Colin Hunt should start his tenure by adding more customers so far excluded from the bank’s tracker scheme.

Disputing the claim, AIB has said that “the customer grouping in question did not hold a tracker mortgage”.

Mr Burgess said the customers started on fixed rates but had a contractual right to a tracker at the prevailing rate when the fixed rate period ended. He claims AIB subsequently failed to offer the customers tracker rates when the fixed-rate period ended.

The bank said that although the customers should have been entitled to a tracker at the end of the fixed rate, they did not end up losing any money.

“Notwithstanding this fact, AIB has provided them with a payment. We are in the final stages of the tracker mortgage examination with payments issued to the vast majority of customers. Over 99% of impacted customers have received payment. The review is ongoing and is subject to continuous engagement with the Central Bank,” a spokesman for AIB said.

It has offered the customers in question in the region of €1,600 for the mistake, it is believed.

Mr Burgess has said the customers have a right to appeal to AIB’s independent appeals panel and “should do so immediately”, saying affected customers can access ways to make their appeals.

“We have taken legal advice on this issue and we will be taking a High Court action to determine it for once and for all. We will begin fundraising for the High Court action in the coming weeks,” Mr Burgess said in a statement.

If the appeal were successful, it could cost AIB up to €200 million in additional redress and compensation for its tracker bill, he claims.

The industry-wide €1 billion tracker mortgage scandal involves around 40,000 cases. It happened when customers were wrongly moved onto more expensive loans by more than a dozen lenders.

In a recent report, the Central Bank said mortgage lenders had paid out €647m to customers by the end 2018, up €67m since August.

The €1bn bill will include compensation paid to wronged customers, as well as administrative costs.

Meanwhile, Irish mortgage rates remain well above the eurozone average, according to Central Bank figures. The interest rate on all new mortgages was 3.01% in January, while the average rate for the eurozone stood at 1.78%, the regulator said.

Most Read in Business