The Central Bank’s Tracker Examination is focused on ensuring that lenders provide fair outcomes for all customers impacted by tracker related failings. The Examination requires all lenders, which offered tracker interest rate mortgages to their customers, to review all mortgage accounts, including accounts in arrears, to identify any tracker related failings both from a contractual and transparency perspective.
As part of the Examination framework, where customer detriment has been identified, the Central Bank has clearly articulated its expectations of lenders to provide appropriate redress and compensation to all impacted customers in line with prescribed Principles for Redress, including:
2.1. Redress will result in impacted customers being returned to the position that they would have been in had the relevant issue not arisen.
2.2. Compensation is to be reasonable and must reflect the detriment involved arising from and/or associated with being on an incorrect rate (such compensation to reflect the specific circumstances of each impacted customer).
Redress and compensation paid to customers should result in the arrears on any account being amended to take account of the non-application of the appropriate tracker rate.
An important part of the Examination Framework is a requirement for lenders to establish independent Appeals Panels, specifically to deal with customers who are not satisfied with any aspect of the redress and compensation offers that they receive from lenders.
In terms of the current status of the Examination, at the meeting of Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach on 4 October last, the Central Bank confirmed that, as of end August, lenders had identified circa 38,400 affected customers (including cases resolved before the commencement of the industry wide Examination) and had paid €580 million in redress and compensation.
The redress and compensation phases of the Examination are now significantly advanced. Some 93 percent of affected customer accounts already identified and verified had received offers of redress and compensation by August 31st. The Central Bank’s supervisory review of conduct of the Examination is also significantly advanced, but will not conclude until lenders complete remaining work.
The Government continues to support the Central Bank in its efforts to complete the Tracker Mortgage Examination as quickly as possible and to see all impacted tracker customers receive appropriate redress and compensation.