Bank of Ireland has written to 1,200 customers in the UK threatened with an increase in their mortgage rates to tell them they will now not face the extra charge according to the Guardian.
The bank's decision comes following a review of customer complaints.
In February, the bank told 13,500 UK customers on tracker mortgages that it planned to increase the margin on their loans from the beginning of May.
However, after receiving numerous complaints, the bank has changed their decision for two groups of customers, saying the move was "in line with the bank's commitment to treat all customers fairly".
Those who had been expecting to face the charges include 1,000 flexible mortgage customers, while 200 people who switched to a tracker mortgage will also avoid the increase.
They received documentation detailing that the differential on their mortgage was variable, but the conditions they were sent did not detail the circumstances under which it could be changed.
The chief executive of Bank of Ireland UK, Des Crowley, told the Guardian: "We have said from the outset that we will review all customer complaints individually and that we are committed to treating customers fairly throughout the process, it is on this basis that we have removed these customers."