I don't understand you using the word 'retrospectively' ? Does that mean they deliberately plucked a rate in the present to say this is the rate which would have applied at the time?
Is that rate similar to prevailing rates in Bank of I and PTSB.
Bank of Ireland is not affected by this issue. They did not issue mortgage contracts which did not specify the margin.
permanent tsb and AIB issued fixed rate contracts which said "when the fix is over you will be entitled to a tracker at the then prevailing rate"
Although ptsb were no longer issuing trackers to new customers, they offered those borrowers whose fixed rates expired tracker rates of 3.25%.
AIB did not give the borrowers the tracker option, as they were no longer doing trackers. Now, years later, AIB is saying "We should have offered you a tracker. But if we had done so, it would have been at 3.67%".
So ptsb set their prevailing rate at the time. AIB set it retrospectively.
I personally think it's very hard to challenge ptsb on this issue, although Padraic Kissane and others take a different view. It's discussed at length in the thread on the issue. However, those who broke out of their fixed terms early, have a great case for getting the lower rate prevailing at the date they broke out of their contract. ptsb is putting them on the rate prevailing when their contract was due to end.
In my view, the AIB case is not defensible by AIB. By definition, you cannot set a prevailing rate 4 years later. They should take the last rate on offer to new customers.
The Central Bank has not commented on it but has approved the refund schemes of AIB, so it is presumably, approving it by its silence.
Brendan