# Appealling the method of TVM calculation



## Banquo (15 Oct 2020)

Hi,

Has anyone any experience appealing the use of interbank rates in TVM calculations for tracker compensation?

These rates are used in interbank compensation claims as a matter of course but I believe are wholly unsuitable or inappropriate in calculating the TVM in these cases. The use of them ineffect rewards the banks for their failure to appropriately apply trackers to these accounts. 

The rate used at a minimum should be the mortgage rate applied to the account for the duration but probably some premium on that rate as a penalty. I'd welcome any thoughts on this point before I proceed with a submission to the panel or FSPO?


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## Brendan Burgess (15 Oct 2020)

Hi Banquo

This is a very complex area and some of the lenders got it wrong.  

ptsb did it right.

AIB did it twice.

BoI had no idea how to do it (I think it was a systems issue)  and did something else instead. 

Which lender and what is your exact point? 

Don't forget that the Central Bank and their auditors have all approved these calculations, so you are going to have a tough time convincing the Panel or the Ombudsman.

Brendan


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## Banquo (15 Oct 2020)

Brendan Burgess said:


> Hi Banquo
> 
> This is a very complex area and some of the lenders got it wrong.
> 
> ...



Appreciate your response but
I am not disputing the calculation as such ( I had assumed they could do basic maths) its the rate at which they compounded the overpayment at? By choosing the lowest rate they possibly could  the TVM compensation is minimal circa 1% I'm assuming in most cases. Meanwhile at that time, the bank was using those funds to lend to others including me at 4% or more.

Put it this way they had use of my money during that time and we're not investing it at 1%.  They have in fact despite all the redress and compensation still profited from this activity. 

Hence im wondering if they have been challenged on this point in the appeals process or FSPO....


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## Brendan Burgess (15 Oct 2020)

Which lender are you referring to?


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## Banquo (16 Oct 2020)

Ulster


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## Brendan Burgess (16 Oct 2020)

OK, I have not studied one of their redress packages, so I don't  know how they do the TVM. 

In general, the right way to do it is  to restate the account at the correct rate of interest with the actual repayments. By doing it like this, the TVM automatically uses the mortgage rate charged. 

Brendan


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## Banquo (16 Oct 2020)

So to be sure I'm on the same page as you.
I am referring to the TVM on the monthly overpayment. Diff between what I paid and should have paid. 
So in the first month back in 2009! That difference was €280 for a single.month,  compounded over the 11year period at an average variable mortgage rate of 3.75% should give me a future value of €420 ( 140 compound interest), correct?

I've asked for the underlying calculations in an exel file to confirm their figures.


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## peemac (17 Oct 2020)

Wasn't the tvm what best deposit rate you would have got for the money. 

On top of that there was the overall compensation. 


I never buy this argument that "the bank was making money on my money", it's rather crude and very much a tabloid type argument especially when the amount is miniscule and certainly for the last few years, banks can borrow at 0% and I think some bonds went negative.


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## Brendan Burgess (17 Oct 2020)

Banquo said:


> I am referring to the TVM on the monthly overpayment.





Brendan Burgess said:


> In general, the right way to do it is to restate the account at the correct rate of interest with the actual repayments. By doing it like this, the TVM automatically uses the mortgage rate charged.



Any other way of doing it will lead to errors.


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## Banquo (17 Oct 2020)

peemac said:


> I never buy this argument that "the bank was making money on my money", it's rather crude and very much a tabloid type argument especially when the amount is miniscule and certainly for the last few years, banks can borrow at 0% and I think some bonds went negative.



I think you misunderstand what banks do and did here. The money they saved by not giving people tracker rates resulted in higher profits not cheap financing. They had no intention of repaying it. They didn't borrow the money from impacted customers they took ownership of it. 

And I'm not suggesting it was a grand conspiracy to defraud me of my few €€€€ but clearly when you factor in they did this to many thousands of people. The money does add up. As did the profits as did the bonuses.


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## peemac (18 Oct 2020)

Banquo said:


> I think you misunderstand what banks do and did here. The money they saved by not giving people tracker rates resulted in higher profits not cheap financing. They had no intention of repaying it. They didn't borrow the money from impacted customers they took ownership of it.
> 
> And I'm not suggesting it was a grand conspiracy to defraud me of my few €€€€ but clearly when you factor in they did this to many thousands of people. The money does add up. As did the profits as did the bonuses.


I understand fully, I was on this site back in 2010 at the start of the fight and got my overpayment, tvm and compensation from KBC. 

The tvm was set at the deposit rate and the overall compensation was then calculated. 


If you can prove that you suffered further and think you deserve more compensation, then the appeals process is there. 

Some have been able to show that they deserve higher compensation and have got it as they could show the trail of costs and stress. 


But wanting more because you come up with a different calculation and use the argument "the bank was using my money" won't cut ice. 

If you think you have a genuine case, go for the appeal.


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