Tuesday, 5 March 2013

Questions (177)

Michael McGrath


177. Deputy Michael McGrath asked the Minister for Finance the steps the Central Bank of Ireland is taking to address the Ulster Bank error which resulted in more than 1,000 mortgage customers underpaying their mortgage for a number of years; the follow-up steps the Central Bank of Ireland has taken following last year's IT systems collapse at Ulster Bank which resulted in weeks of disruption for customers; and if he will make a statement on the matter. [11509/13]

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Written answers (Question to Finance)

I have been advised by the Central Bank that, in accordance with the provisions of Consumer Protection Code, the Central Bank was notified by Ulster Bank Ireland Limited of an under-collection error in mortgage payments. The Bank is working with Ulster Bank to ensure that all impacted consumers are treated fairly. The error resulted from a failure to move consumers to full capital and interest payments after the initial interest only period on their mortgage expired. Where there has been an under-collection, impacted consumers will be afforded ample time to make repayments and will have the opportunity to choose from a number of repayment options. Any impacted consumers who experience difficulty making revised repayments will be treated sympathetically; this will include all protections afforded by the Code of Conduct on Mortgage Arrears (CCMA) where relevant.

The error affects approximately 1,300 accounts with a total of approximately €41 million under-collected from these customers. Impacted customers, who are currently in arrears, will also be afforded the protections of the CCMA where relevant. Ulster Bank will write to impacted customers regarding their own specific circumstances and what action they need to take. For further information, customers may contact Ulster Bank’s specialist team on 1800 303 352.

On the issue of the IT systems collapse the Central Bank has further advised me that they encourage all Ulster Bank customers to contact Ulster Bank to ensure that their issues (as a consequence of this incident) are properly addressed. Customers of other banks who were affected should get in touch with their own bank in the first instance to seek redress for loss and inconvenience. If customers are not satisfied with the outcome, they can make a formal complaint to their bank.

While Ulster Bank is required to reimburse and make good any actual losses suffered by customers, the level of any payment for inconvenience suffered is not subject to the Central Bank’s regulatory standards or approval. This is a commercial decision for Ulster Bank. Where customers are not satisfied with how Ulster Bank has dealt with them, they may refer their complaint to the Financial Services Ombudsman. A copy of the Central Bank statement on Ulster Bank customer remediation plan is available on the Central Bank’s website www.centralbank.ie.