Pearse Doherty (Donegal, Sinn Fein)
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102. To ask the Minister for Finance if he is aware of the sale of tracker mortgages to third parties and vulture funds which were overcharged as a result of the tracker mortgage examination; his views on these sales in the context of the principles of the TME; and if he will engage with the Central Bank with respect to same. [11319/23]

Michael McGrath (Cork South Central, Fianna Fail)
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The Central Bank Tracker Mortgage Examination required lenders to identify all borrowers affected by tracker related issues and to compensate those affected borrowers for tracker related failings on a mortgage in line with the Principles for Redress that formed part of the framework.

The Principles for Redress set out that lenders make redress and compensation offers that were fair and commensurate with the detriment suffered by affected borrowers. This included that such redress would result in affected borrowers being returned to the position they would have been in had the lenders’ failure regarding the customer’s tracker mortgage not arisen. This included that:

- compensation is reasonable and must reflect the detriment involved arising from and/or associated with being on an incorrect rate (such compensation to reflect the specific circumstances of each impacted customer); and

- impacted borrowers to revert to the appropriate Tracker Interest Rate or to be offered the option to revert to an appropriate Tracker Interest Rate, where relevant.

The Central Bank's final report of the supervisory phase of the examination was published in July 2019. It outlined that over 40,000 customer accounts were impacted by lender failings and that almost €700 million of redress and compensation was paid to impacted borrowers and borrowers were returned to the appropriate tracker rate as necessary.

I am aware that some tracker mortgages were sold to 3rd parties including investment funds, and were subject to the Principles for Redress outlined above if impacted by tracker related issues. With the result that were treated in the same way as impacted tracker mortgages that were not sold to 3rd parties.

In the case of impacted loans that were sold by lenders to 3rd parties, the originating lender was responsible for ensuring that borrowers were put back in the position they would have been if the tracker failing had not occurred.

I have been informed by the Central Bank that this included engaging with any new mortgage entity where necessary to ensure that the customer received redress and compensation and the appropriate tracker rate going forward.