The Central Bank has followed through in its investigation of the banking industry into potential abuses involving tracker mortgages by launching an “enforcement investigation” into Ulster Bank.
The Central Bank last year widened its probe into all Irish banks to find out whether lenders here had potentially deliberately or inadvertently put pressure on customers to switch out of valuable tracker home loans, the cheapest mortgages available, to higher-cost loans.
Following an enforcement investigation, Permanent TSB, last summer launched a redress scheme for 1,372 of its PTSB and Springboard customers involving tracker mortgages. The investigation into PTSB is continuing.
Its latest investigation into Ulster Bank emerged on Friday after RBS, the owner of Ulster Bank, revealed that the Central Bank was investigating an enforcement matter at Ulster.
Some Irish banks have made financial provisions to cover potential costs of redress schemes.
“The Central Bank of Ireland can confirm that it is conducting an enforcement investigation into issues arising at Ulster Bank Ireland Limited in relation to certain customers who switched from tracker mortgages to fixed-rate mortgages,” said the Central Bank.
“Separately, the Central Bank can confirm that it is continuing with its examination of tracker mortgage- related issues covering, among other things, transparency of communications with, and contractual rights of, tracker mortgage customers,” it said.
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