Bank of Ireland fined over €100m for tracker mortgage scandal
The fine is the largest the Central Bank has ever imposed.
Bank of Ireland has been fined over €100 million by the Central Bank following a "series of significant and long-running failings" in regards to tracker mortgages.
The fine initially totalled €143,600,000, but was brought down to €100,520,000 in accordance with the Central Bank's settlement discount scheme.
15,910 tracker mortgage customer accounts were affected by the failings between August 2004 and June 2022.
The investigation by the Central Bank found that Bank of Ireland breached regulations under the European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995, the Code of Practice for Credit Institutions, 2001 and the Consumer Protection Codes 2006 and 2012.
The failures resulted in the loss of 50 homes, including 25 family homes.
“Customers are entitled to expect that they will be treated fairly and that financial institutions will act in their best interests," said Central Bank’s Director of Enforcement and Anti-Money Laundering, Seána Cunningham.
"Bank of Ireland failed to meet these most basic expectations for almost 16,000 of its customers over an extended period of time. The failings resulted in significant and, at times, devastating detriment for many of those customers.
"Our investigation exposed a culture in Bank of Ireland which, when faced with a choice, prioritised its own interests with little to no regard for the impacts on its customers. There were a series of missed opportunities during which Bank of Ireland could have done the right thing by its tracker mortgage customers. Despite these opportunities, Bank of Ireland repeatedly interpreted unclear contractual terms in its own favour and against the customer, which continued the harm and loss caused to customers over many years."
Bank of Ireland Group issued an apology on Thursday (29 September), with Interim Chief Executive Gavin Kelly saying that what took place was "wrong".
"It should never have happened. We are very sorry that it did.
“We unreservedly apologise to all customers harmed by the tracker mortgage issue. The impacts were significant and wide reaching, up to and including loss of homes in the most serious of cases.
“Banking is based on trust, but our failures damaged that trust. We have learned the hard lessons, and have taken steps to ensure we are a more customer-focused bank today. This work continues. Rebuilding the confidence of both our customers and the wider society we serve will take time, but we are committed to that journey.”