# AIB's comments on tracker redress in Prospectus



## Brendan Burgess (13 Jun 2017)

From Page 23 (pdf 31)
For example, in September 2015, the Central Bank wrote to AIB to
inform AIB that it had embarked on a broader examination of tracker
mortgage-related issues across lenders that offered tracker interest
rate mortgages to their customers in the Irish market (including AIB
and certain of its subsidiaries located in Ireland) (the ‘‘Tracker
Mortgage Examination’’). In December 2015, the Central Bank
confirmed to the affected lenders that the objective of the Tracker
Mortgage Examination is to assess compliance with both contractual
and regulatory requirements relating to tracker mortgages and in
circumstances where customer detriment is identified from the
Tracker Mortgage Examination, to provide appropriate redress and
compensation in line with the Central Bank’s ‘Principles for Redress’.
In 2015, AIB provisioned A190 million relating to the Tracker
Mortgage Examination. While the Directors believe that this figure is
appropriate, there can be no assurance that the final cost to AIB will
not be in excess of this amount, including as a result of challenge by
the Central Bank to AIB’s redress and compensation package,
sanction by the Central Bank, rulings by the Financial Services
Ombudsman (the ‘‘FSO’’) or customer litigation. Other Irish banks
have been or are being made subject to regulatory sanctions by the
Central Bank in connection with the Tracker Mortgage Examination
or related exercises by the Central Bank and AIB cannot rule out the
possibility of such sanctions being taken against AIB in connection
with the Tracker Mortgage Examination.
• Legislation and regulations introduced in 2012 and 2013 m



From page 160 (PDF 168) 
5.3 Restitution and restructuring expenses
AIB has identified certain legacy issues over time which have resulted in restitution to customers. In
particular, in September 2015, the Central Bank wrote to AIB to inform AIB that it had embarked on the
Tracker Mortgage Examination. In December 2015, the Central Bank confirmed to the affected lenders
that the objective of the Tracker Mortgage Examination is to assess compliance with both contractual and
regulatory requirements relating to tracker mortgages and in circumstances where customer detriment is
identified from the Tracker Mortgage Examination, to provide appropriate redress and compensation in
line with the Central Bank’s ‘Principles for Redress’. In 2015, AIB provisioned A190 million relating to the
Tracker Mortgage Examination, which was included in restitution and restructuring expenses. No further
provision was required in 2016.
Restructuring expenses include costs associated with transformation, reorganisation, certain provisions for
liabilities and write off of intangible assets.
Due to the nature and materiality of these items, they were viewed as exceptional by management. They
amounted to A3 million in the three months ended 31 March 2017 and A58 million, A250 million and
A144 million in the years ended 31 December 2016, 2015 and 2014, respectively.


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