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Ulster Bank to be hit with multi-million tracker fine
Stock photo. Photographer: Aidan Crawley/Bloomberg
Jane Howard, Ulster Bank. Picture by Shane O'Neill, SON Photographic
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ULSTER Bank is set to become the fourth lender to be fined for its role in the tracker mortgage scandal.
The Irish Independent understands that the Central Bank is set to announce a fine of north of €20m today.
It comes weeks after the bank confirmed the bombshell decision of its London parent to close Ulster Bank in the Republic.
It will be the fourth fine imposed by regulators here for the industry-wide tracker scandal which has so far costs lenders a combined €1.5bn.
Ulster Bank has owned up to 5,500 tracker cases, with at least 15 tracker customers having lost their homes as a result of being overcharged by being denied good-value tracker rates.
Customers of the bank were denied their right to a loan linked to the European Central Bank’s (ECB) main rate.
Others were put on the wrong rate.
The bank, which is headed up by Jane Howard, has been persistently criticised when it appeared before the Oireachtas Finance Committee for the slow pace of the tracker redress process for its customers.
It has blamed its IT system for its tardiness in putting customers back on tracker rates, refunding them overpaid interest and paying compensation.
The scandal that dates back more than a decade.
Ulster Bank told an Oireachtas Committee recently that it had set aside €297m to deal with the tracker mortgage debacle.
A number of disputed Ulster Bank tracker cases are due to be adjudicated on by Financial Services Ombudsman Ger Deering.
The tracker scandal was first exposed by this newspaper in 2009.
Permanent TSB was fined €21m in 2019. This was a record penalty for a financial institution in this country.
In 2016 PTSB’s former subprime lending unit Springboard was hit with a €4.5m fine.
Last year KBC Bank was fined €18.3m in relation to the tracker mortgage scandal.
The Central Bank said at the time the lender devised a strategy to move borrowers off cheap loans and “persistently” resisted as regulators pushed it to admit its failings.
The regulator is continuing to carry out enforcement investigations against AIB, EBS and Bank of Ireland.
More than 40,500 borrowers have been affected by the issue, which has resulted in more than €700m being paid in refunds and compensation to date.
The same amount again has been spent by lenders dealing with the refunds, with heavy use of consultants by most lenders to deal with the massive tracker redress process.
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