Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

I propose to take Questions Nos. 29 and 30 together.

As Deputies are aware, the Central Bank has commenced an industry-wide examination of tracker mortgage related issues covering, among other things, transparency of communications with and contractual rights of tracker mortgage customers. The examination is ongoing, and while all lenders are currently in the process of carrying out their internal reviews it is important to note that some lenders may have their internal reviews completed sooner than others depending on the size of their mortgage books and the complexities associated with them completing the examination.  

Last month, the Central Bank issued a statement which indicated that so far lenders had identified approximately 8,200 accounts where a right to, or the option of, a tracker rate of interest and-or the correct tracker rate of interest was not provided to customers in accordance with lenders' contractual or regulatory requirements. In his subsequent appearance before the Oireachtas joint committee, the Governor indicated that this is a lower band figure and that it is expected that the number of affected cases will be higher. The Central Bank continues to challenge lenders to ensure that progress is being made, but at this point there is no further update to hand on the information provided by the Governor on 20 December last.

In the performance of its supervisory functions, the bank identified and pursued issues in regard to transparency with specific lenders for borrowers who opted to switch from their tracker rates or who had the right to revert to a tracker rate at the end of the fixed rate period. However, as new issues continued to emerge, the Central Bank decided that a system-wide review was necessary to ensure that all lenders are acting in their customers' best interests. As a result, the tracker mortgage examination was commenced by the Central Bank in 2015. This examination is now the most significant supervisory review the Central Bank has undertaken in the context of its consumer protection mandate.   

As the statutory enforcement authority for regulated financial services providers, it is the independent responsibility of the Central Bank to ensure appropriate institutional and individual accountability where there is sufficient evidence to support such action. As Minister, I do not have any function in such considerations. Nevertheless, the Central Bank has indicated it will take appropriate supervisory action, including enforcement action against lenders and persons concerned in the management of those lenders, where relevant, to ensure that fair outcomes are achieved for consumers where applicable regulatory standards are not met. The Central Bank recently entered into a settlement agreement with Springboard Mortgages limited, issuing a reprimand and imposing a fine of €4.5 million. However, the Central Bank has advised me that it cannot comment on ongoing enforcement investigations. 

The Central Bank continues to monitor lenders' progress in respect of the conduct of the examination through direct engagement with each lender and its appointed external independent party and through on-site reviews and review of regular progress reporting. The bank is committed to providing regular progress updates on the examination and these will be available on its website.

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