Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

Mr. Kinsella has stated the customers in question were never on a tracker interest rate mortgage. AIB makes this point consistently, but it is completely irrelevant. It has been deemed that thousands of customers, across all of the banks, have been impacted on because they had a contractual right to be offered a tracker interest rate mortgage. The customers we are discussing are in that category. There has, therefore, been a breach of contract which I think AIB now accepts. That is the nub of the issue. Mr. Kinsella has said no tracker interest rate mortgage was available when the customers came off their fixed interest rate mortgage, but they were entitled to be offered a tracker interest rate mortgage at the prevailing rate. We agree that "prevailing rate" is not defined. We also agree that new customers were not being offered a tracker interest rate mortgage, but existing customers continued with them. That was the prevailing rate. There was also a prevailing rate when the customers in question who had a contractual entitlement were offered and drew down their mortgage. There was a defined margin that applied to tracker interest rate mortgages at the time, even though it was not specified in their contracts.

Mr. Kinsella has given an interpretation that is very much in the bank's favour. Dr. Hunt spoke about a customer focused culture. Without a doubt, there is ambiguity in this case. An argument can be made in both directions, but it is not clear. As I said, there is no definition of "prevailing rate". Trackers interest rate mortgage were gone for new customers, but existing customers of AIB continued to have them. The only issue is what the margin should be. The ECB rate is a published rate. My analysis is it should have been the margin that applied when the mortgages were taken out. I refer to the margin generally offered by the bank on its tracker interest rate mortgages at the point in time or the margin that continued to apply to existing tracker interest rate mortgages. Does the bank have a response?