# KBC about to start in front of the Oireachtas Finance Committee



## Brendan Burgess (28 Sep 2017)

http://www.oireachtas.ie/parliament/watchlisten/watchlive/committeeroom2/

Dara Deering
McCarthy
Wim Verbraeken


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## Brendan Burgess (28 Sep 2017)

Wim: We have a range of new products - including a 10 year fixed rate and variable rates as low as 2.95%

Our no gimmicks approach to mortgages

We have a deep empathy for customers in mortgage arrears.

This work has resulted in a significance reduction in cases

The residual cases are more difficulty

Customers who engage early, achieve better outcomes.

We try to avoid repossession. But sometimes it is unavoidable.

*Trackers *
We are working closely with the regulator to identify those affected

It's taking longer than originally participated.

We take this review very seriously. We will complete it asap.

While we have not identified the final outcome

All customers whom we have identified as being on a wrong rate have been put on the right rate

We wish to clarify as a result of a prior narrower review in 2010, we redressed a cohort of customers.

The board of directors still has to make its determination.


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## Brendan Burgess (28 Sep 2017)

*Michael McGrath 

Trackers *
You have given us no numbers.

I have received more representations about KBC than any other bank
lack of communications
Lack of information
There will be a public meeting on the issue tonight

Will phase 2 be complete by end of Sept

How many have you put on the correct rate?
When did you start doing this?

Wim: We started this in 2016 .
Since then we have gone through a further review - it is comprehensive and "interpretative" or "iterative" 
That effort is still ongoing and the Board

We believe it's premature to give interim numbers.

It's not just contractual rights, but also

Context
Transparency 

Disclosure
So it's subjective.

The scheme will be submitted to our board and then to the Central Bank

I can't give a timeline, but we are determined to do it ASAP.

Our first priority is to be comprehensive and not to miss any customers

We identified people in 2016, but put them on the right rate in 2017

McGrath: Will you meet the CB's deadline
Wim: No


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## Brendan Burgess (28 Sep 2017)

McGrath: If you won't give numbers, I will . That is not good enough

Wim: We want to focus on doing it right.

McGRath: What was the 2010 issue

Wim: they received an offer in 2008 to move to a fixed rate.  571 customers were put back based on an initiative from the Central Bank.
There was no redress as they were never overpaying.

McGrath: Did that not trigger a bigger review?

Wim: None of my colleagues here were in KBC at the time.

Wim: There are some cases we are still considering

McGrath. I find it extraordinary that you started in March 2016 and in Sept 2017, you haven't got a handle on it. You can't tell us when it will be finished.

Are you saying that you have identified people who may have been affected, but you have not contacted them? 

That is extraordinary. 

You are welcome in Ireland, but you won't last long if you treat your customers like that.


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## Brendan Burgess (28 Sep 2017)

*Interest rates *

Half of your customers are on standard variable rate e.g. 4.25% (or 4.05% with a current account)

42,000 are on SVR   41,970

4% have opened a current account with KBC.  Since 2015.

Since 2016 - 10% of the SVRs have moved to the new business rate.

The only requirement is

8/10 of new customers have a KBC current account.

Customers with an improving LTV can move down the bands as often as they like

McGrath
Many of those on 4.25% could move to a 3.25% on very low LTVs.

Dara: 80% are in positive equity
But even the 20% in NE can get the 0.2% discount

We have between 11% and 12% of new mortgages

McGrath: You compete on rates. not cash back.

No distinction between new and existing customers.


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## Brendan Burgess (28 Sep 2017)

*Pearse 
*
Switching

I opened an account and it's hard to do even though I am the party spokesman on finance. To be honest, the forms are still sitting on top of the fridge.

Trackers
It's hard to shock me but you have managed to . You provided no numbers to Deputy McGrath.

Why not tell us how many you have already contacted? Even if you ca'nt give us an estimate of the final figure

Wim: We are not in a position to give you any numbers.

What happened was wrong and should not have happened.  But when we do our full report, it will show our commitment to fairness.

We believe that the number redressed to date

What we did in 2010, other banks did not do.

What I can commit to is that we will provide a full overview.

When we are certain someone is affected, we will address them.

Pearse: Have you given them redress.

Wim: No, we have told them that they are affected.
We hope to do that soon.

Pearse:  So we have to go on unofficial etimates that it will be around 1,000 from those campaigning on behalf of customers.

Has anyone lost their home.
Wim: Ultimately, yes.  But that part of the examination is still ongoing.
That it was primarily caused  - but there was a confluence of figures.

Pearse: What do you say to them ?  They have not received any letter. Any offer.

Is that not just additional injury.


Wim:  We will start by wholeheartedly apologising.

Pearse: Is there no hope that you can give them that they will be prioritised. You are sitting up there. There are people down here who are out of their houses. It's nice to be able to package it all together. But it's adding insult to injury.

Wim: These cases will be prioritised.  But I can't commit to a deadline. ASAP.

I don't agree that we are trying to package this

We are very aggrieved by what happened in the past, whether it is one case or 1,000 cases as you suggested.

Pearse: You are not really grasping the issue. The only indication you give is ASAP.

Your numbers seem smaller compared to other banks - why don't your resolve it.

We are trying to establish whether the loss of ownership was due to the loss of tracker.

We have isolated cases which are in a legal process or volutnatry sale process, pending the outcome of the review.

Pearse: How much have you provided for?

Des McCarthy: We made a small provision in 2016. But it was historical.  The amount will be issued with our financial accounts. 

We have not made a provision for 2017 because we can't make a reliable estimate. 

Pearse: [gives a brilliant lesson on accounting standards on provisions]


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## Brendan Burgess (28 Sep 2017)

Pearse: I have a loan with you myself  IIB

You wrote to brokers in 2006 saying everyone on fixed rates was entitled to trackers.

Will you honour that?

Wim: That is part of the review. I can't comment on that as it's part of the review

Pearse: What is your view? It's at least false marketing. 

If a broker told people, "You can fix and then move to a tracker, what should those customers expect?" . 

Wim: I can't comment.


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## Brendan Burgess (28 Sep 2017)

PIAs

We have 100 in process
We have objected to 140
We have approved
310

Mortgage to Rent

Are you planning to do what AIB has done with David Hall's IMHO?

Dara: We are very interested in it. We welcome the reforms.  We are talking to third parties. We see it as a good solution for that cohort.


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## Brendan Burgess (28 Sep 2017)

Senator Burke:  - nothing 

John McGuinness: I am a customer of your bank and I like the bank - you are different. 

I was hoping you would be different in dealing with the committee, but I am bitterly disappointed. 

You won't give numbers 

There will be a meeting tonight.  Will you be at it?

Wim: We were not invited. 

McGuinness; If I went to that meeting tonight and repeated your comments, I would probably be lynched.


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## SaySomething (28 Sep 2017)

Catching a little of this on their lunchbreak and aware of the fact that @Lightening is in the gallery. I'd say the lying through the teeth right now is making her bite down on her tongue!


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## Brendan Burgess (28 Sep 2017)

McGuinness: These delays are intolerable. What about people who are being reviewed who are in deep financial trouble?

Wim: I am not aware of any cases where customers have indicated to us that they are in deep financial stress as a result of the delay in the tracker review. 
Dara: I agree


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## Mauritius (28 Sep 2017)

I've written to the Central Bank twice about this. KBC are making up their own rules. Is it just because they are a foreign bank? I wouldn't even bother phoning the "KBC (no)helpline" anymore as I can hear they guy smirking down the phone when he says "no more information, sorry"....


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## Lightening (28 Sep 2017)

Brendan Burgess said:


> Senator Burke:  - nothing
> 
> John McGuinness: I am a customer of your bank and I like the bank - you are different.
> 
> ...



Just to clarify!! Mr Mc Guinness did say "it's a Public Meeting" however KBC replied they "would not be going"


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