Banks speed up redress of tracker victims with €550m now paid out

BANKS have accelerated redress and compensation to tracker mortgage victims, paying out almost €100m in the last three months as the investigation into the largest overcharging scandal in the history of the State draws to a close.

Six lenders are currently under investigation by the enforcement arm of the Central Bank, which says “enormous” progress has been made in recent months given the scale of the €1bn, system-wide scandal that has affected almost 40,000 mortgage holders.

By the end of the first quarter of 2018, €459m had been paid out to affected tracker customers, with 63pc receiving payments of up to €10,000 each.

Almost a third received payments of up to €50,000. Some 6pc of affected customers received up to €100,000 with 2pc receiving in excess of €100,000.

However, the pace of payments accelerated in the second quarter of the year when banks paid out an additional €98m, bringing the tally of redress and compensation to date to €557.3m.

In an interview with the Irish

Independent, Derville Rowland, appointed director general of financial conduct last September, said that the Central Bank won’t be satisfied until all the money has been paid out to customers.

Two million mortgage accounts were reviewed by the Central Bank as part of the largest consumer protection inquiry the regulator has undertaken.

In the wake of the scandal, banks set aside almost €1bn to cover redress and costs.

Ms Rowland said that after a decade of financial controversies, it was understandable that members of the public did not trust the banks.

“I don’t blame them,” said Ms Rowland, who says the collapse of confidence in financial institutions is a global phenomenon that has seen consumers receive payments of almost €300bn since the onset of the global financial crisis.

Next week the Central Bank will submit its culture review of Ireland’s five main lenders to the Government.