Mr. Padraic Kissane:

I thank the Chairman and members for inviting me to appear before the joint committee. That thanks is on behalf of the thousands of people across Ireland who have been affected by what in my world has been called the tracker debacle. It has affected customers across all lenders. Within that confirmed fact lies a clear indication that this matter and how it came about was based on deliberate actions between each of the lenders. I will tell the committee how this occurred and why and to put across the customer's viewpoint.

I believe before we go forward we must look back. An infamous advertisement ran in 2006.

It showed a guy on a bus saying that he did not know what a tracker mortgage was. A product originally introduced by Bank of Scotland, it tracked the ECB base rate at a certain margin above. Within that lie the causes and results of what happened. It tracked the ECB rate, but the banks borrowed on the interbank money market of Euribor. They were aligned at the outset, but the issues started and banks panicked when they became unaligned.

I know what a tracker mortgage is. This issue first rose in 2009. To understand what a tracker mortgage is, my submission includes definitions and understandings from every bank. A common theme runs through each. For AIB, it is for the life of the loan. For Bank of Ireland, it is for the term of the loan. For PTSB, it is during the term of the loan. For EBS, it is for the term of the loan. For Ulster Bank, it is guaranteed for the life of the loan. KBC guarantees to track to ECB reference rate. For First Active, the interest rate will never be higher than a certain margin.

From these definitions, what the product was - what people signed up to - was clear. For a long time, I have argued that the variable bases of those loans were established when the people commenced them.

Regarding what went wrong with the product, the alignment of Euribor and the ECB changed dramatically in mid-2008. The ECB reached a peak of 4.25%, the banking collapse that became known as the financial crisis occurred and banks suddenly panicked. I am certain that high-level meetings were held in each bank to address the issue. I know of no lender that has admitted to this or made available the minutes to any such meeting, but it is clear that meetings would have had to have occurred. Then the messing with customers' accounts began. For example, PTSB came up with the idea of getting customers to break from their fixed rates and subsequently denying them a return to trackers because they broke from those fixed rates. In some cases, EBS decided not to offer the rate at all and see what happened. Bank of Ireland tried the same line, namely, that it did not do tracker mortgages anymore, so tough luck. KBC tried to claim that, since one of the forms that customers signed included the phrase "thereafter reverting to a standard variable rate", it would discount any customers returning to their trackers. KBC did not even have a standard variable rate mortgage when people were fixing loan rates. All home loans reverted to trackers, as the infamous e-mail claimed. AIB has tried every excuse to get out of trackers.

In one of the decisions in which I was involved, however, the Financial Services Ombudsman decided that the underlying contractual position of the variable basis of the loan was clearly set out at the commencement of the loan and was not altered in the customer selecting a fixed period. Astonishingly, this was not challenged in any court. Of the cases that I have won through the Ombudsman's office, not one has been challenged to the High Court. Every one of them was accepted.

The answer to the question of what would have happened had no banking issues arisen in 2008 is clear. The conditions that everyone signed up to did what they said on the tin, as the saying goes. The margin was for the life of the loan. According to the banks in their various replies that I have received over the years, the customers were meant to be the legal, financial and banking experts in understanding their documentation. However, the contracts were clear. All that differed in each was the margin above the ECB rate that was allocated to loans based on various reasons, for example, loan-to-value ratios and the percentages that would have been borrowed against those ratios. The only reason any of this changed was because of the banking difficulties that arose from mid-2008 onwards.

I am at this meeting to discuss the customers of all banks whom I have met since 2009. The purpose is to tell the committee the effect on those people and, more importantly, their families. I have met hundreds of these customers across all lenders. The impact of the banks' actions have been catastrophic, especially on families and children.

Members are aware from some of the lenders that the banks' actions have resulted in the loss of homes. However, what needs to be examined in this context is the number of customers who have had any type of loss of ownership. The only numbers put forward by the banks to date are those that can be classified as homes lost, which suits the banks perfectly because it keeps the number small, but there is no difference if a home is sold to trade down to meet the overcharging or to emigrate, if a property abroad is sold to help meet the payments or if a property is voluntarily sold to avoid the inevitable happening, that being, emptying all of a customer's savings first, then asking friends and parents for help, approaching the credit union for a short-term loan, running up debts on cards and current accounts to their max to meet the payments and, if all of that was not enough, going into arrears.

Homes are not all that have been lost in this debacle. Lives have been lost, and most people affected have had their lives and outlooks changed. These lenders have used our "Irishness" against us. By that, I mean that the desire of Irish people to own a home and put down roots is fundamental to our make-up. To attack that section of their customer base is appalling behaviour. In the majority of cases, customers have done everything possible to avoid going into arrears on their homes. Add in the unique economic circumstances that prevailed at the time and what was created by the banks' actions was the perfect storm.

That the lenders set about deliberately attacking and robbing home owners - essentially amateur investors - is truly appalling. There are unwritten rules in place that are not covered by any consumer protection code, law or directive but are sacrosanct when it comes to being a home owner. Banks should be able to be trusted in how they deal with home owners especially.

In 2014, I wrote a piece at 6.30 a.m. one morning when I got up, entitled "Why is the customer always wrong?" I will read it into the record:

I cannot understand the continual erosion of a time sound basis of business namely the customer is always right to one now where the customer is always wrong.

The acceptance as a requirement by these lenders of time as the important ingredient as well as cheap capital in order to restore their basis of becoming pillar banks but to then use the very opposite weapons namely no time or cheap rate to help their customers recover is wholly unfair that it has been allowed to happen.

But the cunningness of how it has been done to include our Government and the Central Bank as co-perpetrators of these actions is unacceptable.

It is clearly obvious to me that far from becoming pillar banks that will support our economy there is only one requirement for the heads of all lenders and this is to squeeze the customers to the very limit of what they can get away with because in the new financial world within Ireland the customer is always wrong.

I am here today to say that the customers are not wrong and were never wrong.

I commend the customers who challenged these lenders. It was no easy journey for anyone. I know first hand what it takes to take on these lenders with their power, might and financial strength. I stated this in 2009, but no one listened. It is now 2017 and we still have the same problems. I challenged my first tracker case in 2009. Since then, I have been challenging lenders, initially through the processes of the Financial Services Ombudsman, culminating in getting the matter to the Central Bank industry-wide investigation. One would think that, at this stage, the banks would accept that their game and trickery are up and that each has been caught, but not a bit of it. I want to state on the record that there is not one morsel of regret within any bank that I have encountered for what they have done. Their only regret is that they have been caught.

One must remember that, until August 2015 for PTSB and August 2016 onwards for the other lenders, each customer affected by this tracker issue believed it was his or her own fault. Customers blamed themselves for buying that nicer home, for trading up and keeping the existing home as an investment or for having to borrow so much money to even get on the ladder. It was all their own fault. These became known as the Celtic tiger fools. It seems conveniently forgotten that the levels of stamp duty, VAT and fees that contributed to the finances of the State were enormous.

I wish to address some words towards the Central Bank. I want it noted on record that I support and acknowledge the efforts that the Central Bank is making in this investigation. While accepting that the Central Bank might have arrived to the matter somewhat later than was ideal, it must nonetheless be acknowledged that it has arrived with its investigation. Currently, there is an enforcement investigation into PTSB and Ulster Bank and an industry-wide tracker investigation across all lenders. The difficulty for the Central Bank is that it cannot make any statement of note other than updates until the investigation is complete.

I disagreed with the treatment that the Governor, Professor Philip Lane, received at his most recent appearance before this committee. The Governor and the Central Bank have not taken one cent from any customer. The banks did. I would ask this committee and indeed all who are affected to place a degree of trust in our Central Bank to do its job as I do, but it must be allowed the time to complete its work. I accept the difficulties that the waiting is causing to the families and individuals affected. For that, the lenders should be ashamed.

The lenders' current CEOs are holding the reins of responsibility for how their banks are behaving. I cannot and will not accept the reply of "I was not there when this occurred." The legacy of this issue is being written as each day passes, but the word "apology" is being used without the support of any degree of true remorse. There is still a level of resistance within each lender to correct the matter fully.

I am still being told on a daily basis that I am wrong. Each lender is attempting to tell me I am wrong about a matter that is within the banks' own documentation. I challenge the CEO of each bank to take full control of and responsibility for the investigation and to put the customer first and the bank second.

I have been in financial services for over 33 years and I am appalled at the level of wrong done to customers by the banks. I have heard the heads of some of the banks come into this room and give this committee details of the number of accounts affected. Everything is scripted to perfection to ensure that nothing wrong is said. That caution and care reflects the fact that the banks are concerned to ensure that they do not cause further damage to themselves. Each of these banks has made provisions without any degree of knowledge of the harm their actions have caused. I have spoken to thousands of customers and the level of hurt the banks have caused is truly appalling and I am certain that each lender has no real sense or understanding of this.

I am mindful today of the people who have met me to tell me their story. I mention in particular the brave couple who took the matter to the High Court at enormous cost to themselves and their family, both health wise and financially. They won their case in court only to be redressed by PTSB with a margin of 3.25%, which was never allowed for and their fight continues today. I think also of the lady who felt humiliated when she had to leave her Christmas shopping trolley behind, four days before Christmas, who was being overcharged by €1,000 per month at the time. I think of the man who was only able to meet with me because the rope snapped when he attempted to take his own life, the man who had to take a back office position in a bank for fitness and probity reasons and the man who could not accept his redress cheque as he had no bank account after losing his home. I am mindful also of the many couples who have split up and the effects of that on their children, the many families who have had to emigrate and the people who had their homes and properties taken from them illegally. The list goes on and on - 15,000 times or more. I cannot forget and I must applaud the sacrifices made by the parents of many affected customers who, while their children were being deliberately overcharged by banks, assisted them with payments to meet their loans. Ironically, some of these parents had lost their entire life savings because of the fall in share value in these banks.

The economic circumstances at the time represented a perfect storm for the affected customers and their families. It is a truly appalling and horrific what these lenders have done to customers. The customers and their families did nothing wrong. I get angry when I hear the replies from these lenders who appear to have not one morsel of regret. I made a commitment to all of the customers that engaged with me that I would go shoulder to shoulder with them, wherever that journey takes us. I will continue to do so until I am proved right, whether through this investigation, the redress process, the ombudsman, the Irish courts or the European courts. Giving each customer the opportunity to draw a line under this sorry matter should have been the desired outcome from the very outset. Issues within families, relationships and careers, ill-health, shame, isolation and social exclusion are but a few of the effects I have encountered in my dealings with customers. No bank has escaped in this debacle. When one realises that it should never have occurred, one begins to realise the tragedy of the whole matter. Life will go on for sure but the scars will remain with people for ever. To delay that healing process will be a continuation of the wrong doing.

The banks should refer to the numbers of people affected. If they do not do so, this committee must find out why. This is not just about the accounts that are affected. It is about the sanctity of the family home which has been attacked by our banks, in direct contravention of Article 40 of our Constitution. It is also about the malignant effect the banks' behaviour has had on the social fabric. It has resulted in death, separation, divorce, family breakdown and ill health. The family is also protected in our Constitution under Article 41. The banks have attacked customers, their families and their homes. It is claimed that 15,000 accounts are affected but up to 500,000 people could be affected by this debacle, directly or indirectly. A willingness to borrow and an eagerness to lend was always a recipe for disaster. This disaster occurred because our banks made credit too easily available and tried to get their customers and the State to pay for their mistakes.

I thank members for their attention. I will now take questions on each bank.