# permanent tsb starting at the Oireachtas Finance Committee shortly



## Brendan Burgess (6 Feb 2018)

http://www.oireachtas.ie/parliament/watchlisten/watchlive/committeeroom3/

In private session at present


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## Brendan Burgess (6 Feb 2018)

Jeremy Masding
Ger Mitchell   HR,. mOrtgage and consumer product director 
Stephen Groarke

Brid Timony
Greg O'Leary

Three programmes

2015 ptsb-specific programme
The Product Review Group we launched 

The CBI Industry Wide programme
1,979 in total  - all have been offered.

1,374 under the 2015 programme -70%
605 accounts under the industry wide programme and product review group

The majority have accepted the payments.
All are now on the correct tracker rate

The final letter were sent in Dec 2017

Some have not accepted the payment, but accepting it now, has no impact on their right to appeal or challenge the amount offered.

Most of ours were due to customers breaking out of fixed rates early and we didn't tell the customers the consequences.

We have found no evidence that this information was deliberately withheld.

Other categories

Admin errors
201 by the Product Review Group

342,000 mortgages over a 12 year period were reviewed
24 months
200 people

404 idendifed by the Industry-wide review

*The appropriate rate is an issue *
The margin above the ECB rate

We are returning to people, that what was theirs
The money they lost
The  option they had

But the margin they could return to depends on the contract or the fixed rate agreement.

Some had a price promise

But others had no price promise

Similar to what is happening today. People with a three year fixed move to a variable rate which they won't know for three years.

This was applied to customers who did not fix.  .75% to 3.35% above the rate. Depending on the date.

Customer A who stayed on the fixed rate without breaking got the same rate as Customer B.  This is consistent.

*Overall attitude of banks to tracker mortgages
*
I have seen no evidence that the bank was acting against the interest of customers with trackers

we did not prevent existing customers
47% of our balance sheet was in trackers when trackers were stopped, and this grew to 53% by the end of that year.

Half our customers have tracker rates.

In 2014, we developed a product for movers to help them move and keep their tracker.

30,000 long term treatments have been given to customers without affecting their trackers.


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## Brendan Burgess (6 Feb 2018)

*Michael McGrath 
*
People who lost their homes and legal proceedings

*Ger Mitchell: *

Independent Review Panel  heard loss of ownership or advanced stage of legal proceedings
40 appeals upheld or   258% of initial compensation

31 loss of ownership - 12 PDH. 19 Buy to lets?
278 appeals
262 adjudictat
74 upheld

40 to IRP - all upheld fully or partially
34 to Customers Appeal Panel of 238 ( 14%)

McGrath: Why did you have an employee on the CAP?

Masding: We thought that the cases would be complex.  The majority was independent.

The Chair has confirmed to me that our rep acted independently and was very helpful.

McGrath: The defendant is not usually a member of the jury


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## WizardDr (6 Feb 2018)

Every single one of IRP appeals were upheld or partially upheld (40 out of 40) - that is 100%
Therefore 262-40 = 222 CAP of which (74-40) = 34 upheld -that is 15.3%.


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## Brendan Burgess (6 Feb 2018)

I stand corrected.


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## Brendan Burgess (6 Feb 2018)

Masding: We have been concerned to hear some solicitors argue that people should ignore the Appeals Panel 

That is nonsense. There is no downside to it.

McGrath: How many court challenges? 

Masding: Quite a low number 

McGrath: Has the CB signed off on your approach to the Prevailing Rate issue? The approach and the margin. 

Masding:  We have made our position to clear to the CB. We have no negative feedback from the CB. 

Stephen Groarke:  Their position is that it's for the bank to provide.  They have not objected.

McGrath: How did you calculate the rate 

Groarke: We calculated the rate at the time in line with the cost of funds.


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## Brendan Burgess (6 Feb 2018)

*Pearse Doherty*: Is it still your contention that it's a systems error 

Masding: Yes

Doherty: Even after a customer contacted you? 

Masding: Yes


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## Brendan Burgess (6 Feb 2018)

Masding: The lodging of the Supreme Court appeal did not delay things

This is what I did - in response to Pearse's attack

I stopped the Supreme Court Appeal
Our appeals process was speedy
sponsoring the establishment of the product review group
loss of ownership - we put a pause on all legal action - only bank to do so

Pearse: Explain the Systems Error

Masding: We had an obligation to explain to customers the implications of breaking early.

Pearse: Do you accept that they had a legal right to a tracker mortgage? 

Groarke: They had a regulatory right, not a legal right. The regulatory right supersedes the contract.

Pearse: Was there a policy document to deprive people of trackers 

Groarke: No, I have not seen one. 

Pearse: Did you break the law

Groarke: No - regulatory errors and operational errors by not applying the due care and diligence.


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## Brendan Burgess (6 Feb 2018)

Pearse: 31 lost properties.

Mitchell: only 50% of them went through the Independent Appeals Process

Pearse and McGrath: That is not what you told us earlier

31 lost their homes
How many could have used the IAP?

Masding: We will check to see if we have that information.

The time for an appeal was 12 months, but we have accepted late appeals.

Pearse: But you are still open to appeals

Masding: Yes

Mitchell
7 of the 31 who lost their properties appealed.  Sorry, we don't know how many of those were family homes.

Pearse: This is scandalous.  You have an obligation to inform people.
You have put the onus on the victim.

Mitchell: 29 have lodged the cheques. 2 have not but we have been in contact with them. We have gone to great trouble to tell them that they can lodge an appeal.

Pearse: Do you intend to offer them more compensation?


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## Brendan Burgess (6 Feb 2018)

*Ciarán O'Donnell *
24 out of 31 did not appeal the loss of their properties

Mitchell
29 have cashed the cheques - so they got the appeals form
Two have not cashed the cheques since 2015
7 have appealed
Did the other 22 say that they were not appealing.

The Chairman will extend the appeal period if they wish

The two are very sensitive cases. They are vulnerable customers.  We are engaging with them.

33 others in the legal process lodged an appeal - who did not lose their homes.


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## Brendan Burgess (6 Feb 2018)

Thomas Ryan
Hazel Melbourne 

were here from ptsb with Padraic Kissane.

Why did you appeal the High Court decision in the Ryan's case. 

The High Court decision changed fundamentally the way banks could advise in Ireland - we had to appeal. 

But I dropped it when I saw the impact on customer welfare.


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## Brendan Burgess (6 Feb 2018)

Senator Conway Walsh: What happens if a loan was sold e.g. Springboard to Mars Capital? 

Groarke: The CB made it clear that responsibility lies with us and we have redressed them.


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## Brendan Burgess (6 Feb 2018)

Chairman John McGuinness : How do you deal with warehouse cases?

Groarke:  Restructured cases are complex. When we have warehoused an account, the warehouse would have been smaller. So a lot of the redress would be set off against the warehouse


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