Michael McGrath (Cork South Central, Fianna Fail)
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92. To ask the Minister for Finance the compensation percentages offered by each of the lenders involved in the Central Bank's tracker mortgage investigation; if these rates differ for buy-to-lets; if so, the amount by which the rates differ; if payment for independent financial advice is conditional on the borrower obtaining advice; and if he will make a statement on the matter. [41193/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Central Bank has advised that it is acutely aware of the unacceptable impact that lenders’ failures have had on impacted PDH and BTL tracker mortgage customers. Although a significant portion of the lenders’ failures occurred prior to the introduction of the Central Bank’s customer redress powers in the Central Bank (Supervision and Enforcement) Act 2013, the Central Bank has stated that it expects lenders to provide redress and compensation to all impacted customers.

As part of the Examination framework, where customer detriment is identified, the Central Bank has clearly articulated its expectations of lenders to provide appropriate redress and compensation to impacted customers in line with its prescribed Principles for Redress. Key elements of the Central Bank’s expectations in respect of redress and compensation for impacted customers include:

- any harm is stopped at the earliest possible time after each group of impacted customers is identified;

- the interest rates applied to impacted customers’ accounts revert to the appropriate tracker interest rate or impacted customers are given the opportunity to revert to such a rate where relevant;

- redress will be provided to impacted customers to return them to the position they would have been in had lenders’ failures not occurred;

- reasonable compensation, that reflects the detriment suffered by individual customers, is provided;

- redress and compensation is to be paid to impacted customers up front at the point of offer and compensation cannot be reduced by virtue of a customer lodging an appeal;

- an additional payment is to be provided to impacted customers at the point of offer to enable them to take independent professional advice regarding the redress and compensation offers made to them - it can be noted that this payment is to be made up-front and is not conditional on the customer obtaining financial advice;

- an independent appeals process is to be established to address complaints from customers who are dissatisfied with any aspect of the redress and compensation package that they receive from lenders; and

- lenders will undertake not to raise any time limit defences that may otherwise apply if impacted customers make complaints to the Financial Services Ombudsman (the “FSO”) or initiate proceedings before the courts.

The appeals element of the Principles for Redress ensures that customers have an option to challenge any aspect of the redress and compensation package, which is additional to the options of bringing a complaint to the FSO or initiating court proceedings.

Each lender is responsible for designing and executing their individual redress and compensation programmes in line with the Principles for Redress. The Central Bank advises that, as far as possible, it is challenging lenders' compensation proposals to ensure that customers receive appropriate compensation.  However, as it would constitute specific supervisory information, the Central Bank is not in a position to comment on redress and compensation programmes put in place by individual lenders due to the confidentiality requirements of Central Bank legislation.