Michael McGrath (Cork South Central, Fianna Fail)
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198. To ask the Minister for Finance if each State supported bank offers, in certain circumstances, an interest rate to an existing mortgage customer which is outside of the advertised rates for that particular category of customer including, for example, in a situation in which a customer has informed the bank that he or she is switching to another lender; if the Central Bank has a view on this; and if he will make a statement on the matter. [13299/17]

Michael Noonan (Limerick City, Fine Gael)
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I have received the following responses to the Deputy's Question, from AIB and PTSB:

AIB

"AIB s approach to Mortgage pricing has been to pass on pricing reductions to both new and existing customers ensuring existing customers are treated fairly. In a very small number of circumstances the bank may provide a rate outside the advertised rates where there is a compelling justification to do so from a customer or commercial perspective. AIB would emphasise that this is not a general practice and the case numbers involved are negligible

PTSB

"Permanent tsb does not offer rates that are different to the rates that are advertised on either our website or in branch.

The only instance where existing customers can avail of a lower rate is if they avail of permanent tsb's MVR switch offer. This is the offering from the bank to all our standard variable rate (SVR) Customers who can move from a rate of 4.5% to a managed variable rate of 3.7% to 4.3%. Our managed variable rates will vary depending on the amount owed and the value of the property in question. The highest rate charged (for customers whose mortgage is equal to or greater than 90% of the value of their home) is 4.3%, 0.2% less than our current Standard Variable Rate (SVR). Full details of the offering is available on the link to our website below:

."

The Central Bank of Ireland has also provided the following response:

"The Central Bank does not have a statutory role to prescribe the rates that mortgage lenders charge on their loans. The pricing of mortgage loans is a commercial decision for the lender.

The Central Bank requires that all mortgages are advertised and sold in accordance with the requirements of financial services legislation (including Central Bank Codes), and that consumers who choose a given mortgage product (or switch to a new product) are treated in accordance with these requirements in the context of the product they have chosen.  

Following a public consultation, on 21 July 2016, the Central Bank announced the introduction of a number of increased protections for variable rate mortgage holders. These enhanced measures, which are provided for in an Addendum to the Consumer Protection Code 2012 (which can be found at: ), and effective from 1 February, require lenders to explain to borrowers how their variable interest rates have been set, including in the event of an increase.  The measures also enhance the level of information to be provided to borrowers about other mortgage products their lender provides that could provide savings for the borrower and signpost borrowers to the CCPC's mortgage switching tool. Lenders must now also clearly outline where they apply a different approach to setting the variable interest rate for different cohorts of borrowers and the reasons for the different approach."