# ptsb redress programme announced



## Brendan Burgess (28 Jul 2015)

See attached
Statement by permanent tsb and Springboard Mortgages Ltd.


• permanent tsb and Springboard Mortgages Ltd write to a total of 1,372 mortgage customer accounts regarding a serious failure in respect of the management of their mortgage accounts

• Major Redress and Compensation Programmes follows enforcement investigation by Central Bank of Ireland

• Chairman and CEO of permanent tsb Group Holdings plc (“permanent tsb”) describe failure as “deeply regrettable” and offer “an unreserved apology on behalf of the Group to all impacted customers”

• The majority of failures for impacted accounts occurred between 2006 and 2011


Following an enforcement investigation by the Central Bank of Ireland, permanent tsb has announced the commencement of the Mortgage Redress Programme; a major redress and compensation programme to address the position of 1,372 mortgage customer accounts which lost their contractual right to a tracker rate mortgage in circumstances wherethere was a failure by the Group in the management of the relevant mortgage accounts.

The majority of the impacted accounts (1,152) were accounts of permanent tsb. A further 220 were accounts of Springboard Mortgages Ltd, which is a subsidiary of permanent tsb.

Impacted customer accounts may have suffered serious consequences as a result of the failures including:

• Having to pay higher mortgage repayments than should have been the case

• Going into arrears that may not otherwise have occurred

• Being engaged in legal proceedings that might not otherwise have been
necessary

• In the case of sixty‐one of the impacted accounts, customers may have lost ownership of the relevant property linked to the mortgage in situations where they may not have lost these properties if the failures had not occurred.

*Comment by Chairman and CEO of permanent tsb Group Holdings plc*
The Chairman and Group Chief Executive of permanent tsb Group Holdings plc (Alan Cook and Jeremy Masding respectively) described the failure by permanent tsb as “deeply regrettable”. In a joint statement they said: “the failures which occurred have had very serious consequences for impacted customers and we apologise unreservedly on behalf of the Group to them and to all our customers. We are truly sorry that this has occurred and our absolute focus now is on correcting the position of every impacted customer as speedily as possible.”

Mr. Cook and Mr. Masding said that permanent tsb was particularly focused on sixty‐one accounts where impacted customers lost ownership of their properties: “We acknowledge that the bank’s failure may have been a factor in events that ultimately led to some customers losing the property linked to the mortgage. We will do everything in our power to help these customers.”

*Explaining The Failures*
permanent tsb:
The circumstances in which permanent tsb’s failures arose are as follows:
• permanent tsb failed to inform certain customers fully of the consequences of their decisions to break from a fixed rate or discounted tracker rate early. The consequences of breaking early were that customers lost their contractual right to be offered a tracker rate in the future (at the time that their fixed rate or discounted tracker period would have ended) and

• Other customers had a contractual right to be offered a tracker rate at the end of any fixed rate period. However due to a failure by permanent tsb that option was not communicated to them at the end of their fixed rate period.

Springboard:
In the case of Springboard Mortgages Ltd. the failure arose from the application of incorrect interest rates to 220 mortgage accounts.

*Details Of Redress + Compensation Programmes:*
The Redress and Compensation Programmes for the two institutions differ only in one respect. For impacted customers of permanent tsb, as there is no certainty as to what individual customers might have chosen to do had they been informed fully at the relevant time, permanent tsb will seek their instructions on whether they choose to move now to the tracker interest rate provided for in their mortgage loan conditions, i.e. the rate which they might have moved to, but for permanent tsb’s failures.

The interest rate payable by impacted permanent tsb customers has been reduced to the level of the relevant tracker rate mortgage for an interim period to allow them to consider their options.

In the case of Springboard, the failure was that the customer was on an incorrect rate and therefore Springboard has now moved them to the correct rate and is paying the redress and compensation amounts identified.

The details for the two institutions are as follows:


----------



## Brendan Burgess (28 Jul 2015)

Loss Of Ownership Cases:
Sixty‐one accounts, which were impacted by this failure, have seen a loss of ownership of the relevant property since these failures occurred. A review of the relevant cases by permanent tsb and Springboard suggests that, in twenty‐two of these cases, the customers may have avoided losing their property if these failures had not occurred. The appeals panel may find that the failure was a key factor in more of these cases based on additional information that customers may provide to them.

Impacted customer account holders who have lost ownership of their relevant property will receive compensation payment of €50,000 where the property in question was their Home and €25,000 where the property in question was a Buy‐to‐Let property. If permanent tsb's failure was a key factor in the customer losing the property, any monies still owed by the customer on the mortgage account will be written off.

The Central Bank of Ireland is undertaking an Enforcement Investigation into
permanent tsb and Springboard Mortgages Ltd. permanent tsb is co‐operating with this Enforcement Investigation in respect of the two institutions.


----------



## Brendan Burgess (28 Jul 2015)

*Some more details from press conference focussing on ptsb only *

Compensation of €3,200 will be paid automatically to everyone affected.  They can keep this and still appeal it.

*Revised rates for people *
275: < 1%
318: between 1% and 2%
86: 2.3%
37: 2.4%
266: 3.3%
92: 3.4%

*39 people lost their homes (22 lost their buy to lets) *

45 ptsb and 16 springboard


"It appears to have been a factor in 22 of the total of 61 cases" 

In 39 cases, it's unclear.


----------



## AAM_User (28 Jul 2015)

Thank you Brendan, for facilitating the discussion of the issue & coming together of those affected.  There's a lot to take in in that release.

I'm not entirely sure what they mean about the tracker mortgage moving again


----------



## George13 (28 Jul 2015)

I don't understand the FAQs re overpayments - are they saying they are taking it off the loan balance first and after that we might get a refund? I assume they mean they overpayments we all made unintentionally rather than the ones some people make intentionally.


----------



## dec_hy (28 Jul 2015)

aam_user - I think its just we're on a 'temporary tracker' while we look at the info they send us.  we need to formally agree to moving to the tracker rate by signing the docs.  obviously depends whether you're happy with the rate offered etc...


----------



## Gerry Canning (28 Jul 2015)

Mr Masding , Boss of PTSB apologies not accepted.
The only reason PTSB is paying is that they are forced to.


----------



## matan (28 Jul 2015)

Can someone explain the redress section?  Am I correct in thinking that this states they are going to refund our money to lower our mortgage and not send out a cheque for the full overpayments, I for one do not want it paid off my mortgage, I want it refunded!!


----------



## working mom (28 Jul 2015)

The more I read this the more confused I am !!! My mortgage rate from next month is 3.3% . What if the ECB rate rises? which as we all know the only way for it now is up, as it can hardly go any lower ...could we be faced with even higher rates in the future ?? A lot to think about before changing to the tracker rate !!!  It is absolutely disgraceful that we all received a standardisation sheet with a margin of 1.1% what the hell was the point of it, if they won't stand over it ? It was part of our loan offer at the time . Good faith my eye !!!!! I am so annoyed over al of this .


----------



## random2011 (28 Jul 2015)

working mom said:


> The more I read this the more confused I am !!! My mortgage rate from next month is 3.3% . What if the ECB rate rises? which as we all know the only way for it now is up, as it can hardly go any lower ...could we be faced with even higher rates in the future ?? A lot to think about before changing to the tracker rate !!!  It is absolutely disgraceful that we all received a standardisation sheet with a margin of 1.1% what the hell was the point of it, if they won't stand over it ? It was part of our loan offer at the time . Good faith my eye !!!!! I am so annoyed over al of this .



I couldn't agree more with you working mom. We need to work together to get this resolved. Do not sign the offer of 3.3%. Is your mortgage any different to what others signed up for apart from one had a margin specified and yours did not. I do not think so and as you say the ESIS shows this. Aside from the ESIS where in the contract does it say PTSB can increase the margin by over 200%. I just hope the CB can see the attempt PTSB have made with continuing to fleece their customers. Its also very frustrating to see all the broadcasts in the news today about this but no mention of the situation customers you are facing by having no rate specified.


----------



## working mom (28 Jul 2015)

Exactly randon2011, poeple have lost their homes over the incompetance of PTSB , yet all we will hear is how much "so called compensation " the banks are offering . They should be made deliver not only on the contracts of the loan offers but also on the assumptions made...if they had set the margin at 7% or even 10%  I gaurantee you, we would have to stick to that assumption !!! It is really time for the Central bank to take the blinkers off and open their eyes !!!!! OR our Government to for once do the right thing by it's citizens and enforce penaltys on the bank if they refuse . After all at the time I drew down my mortgage  even the dogs in the street were under the impression that a tracker mortgage rate was tracked with the ECB rate with a percentage of 1% above . How dare they try and redefine the definition of what a tracker mortgage is now to suit themselves .


----------



## L John (28 Jul 2015)

If it is found by the central bank that there was a strategy taken by ptsb to create a mortgage pricing policy by luring these clients off their tracker contracts by waiving break out fees and offering artificially low short term variable rates which consequentially led to their clients losing their homes, their banking licence should be revoked


----------



## Descart (28 Jul 2015)

The redress compensation payments are abysmal particularly in relation to the losing of one's home or indeed a buy to let property. If a case is taken by those affected to the High Court, the Judge would have the ability to award aggravated damages due to the gross reckless behaviour of the bank. There is also the question of consequential damages. This could see conservative awards well in access of 100,000 euro for claimants.

Has anyone complained to the Gardai about the bank's behaviour, which I believe is tantamount to fraud. Maybe the CEO of PTSB  can tell a Criminal trial Judge his actions were "deeply regrettable " before sentencing. The actions of PTSB in this instance, is not a civil matter but indeed a criminal matter.


----------



## PTSBCase (28 Jul 2015)

I agree re. compensation. People lost their homes and that's all they are getting. Also, the compensation levels been offered to anyone affected who managed to keep their home are poor too. People should unite and not accept it, and if that means pursuing it through the high courts so be it.


----------



## Bronte (28 Jul 2015)

A post I made seems to have gone missing, but David Hall of IMHO puts it well here:

http://www.irishtimes.com/business/despicable-ptsb-failures-caused-customers-to-lose-homes-1.2299575

*“What level of compensation would be enough to cover someone losing their home? How can you put a figure on all the stress and fear?

“This bank fought this all the way. They took it as far as the steps of the Supreme Court and this is consistent with how they do business,” he continued. “No heads will roll at the bank. They will be rapped across the knuckles by the Central Bank and that will be the end of it

No money will ever compensate these families for what they have been put through.””*


----------



## Descart (28 Jul 2015)

Yes, if you proceed you will win, the bank will also have to pay your legal costs as well as there own in any legal action.


----------



## Descart (28 Jul 2015)

Bronte,

The reason why they fought this all the way to the Supreme Court is quite cynical, they hoped to exclude those affected, taking a civil claim due to our archaic statute of limitations ( 6 years to make a claim ).


----------



## George13 (28 Jul 2015)

I hope all those thinking about getting PTSB mortgages are reading this thread


----------



## Bronte (28 Jul 2015)

George13 said:


> I hope all those thinking about getting PTSB mortgages are reading this thread


 
You're funny, you think all the other banks are saintly, they are all the same in my experience.


----------



## matan (28 Jul 2015)

To be honest PTSBCase I don't have the energy to go through the Courts any more, this has consumed my time and thinking for the last four and a half years since I wrote my first letter of complaint.  Yes I want my refund in my account not off my mortgage, I want compensation but going through Courts, I don't know if I could mentally draw this out for another few years, which is the time for the Courts process in this country!


----------



## Brendan Burgess (28 Jul 2015)

random2011 said:


> Its also very frustrating to see all the broadcasts in the news today about this but no mention of the situation customers you are facing by having no rate specified.



Hi random

I have mentioned it in at least two interviews and probably three. I have also briefed the newspapers on it.

Brendan


----------



## PTSBCase (28 Jul 2015)

Just saw this on the PTSB website re redress:

"In other cases, the customer’s conditions provided that they are entitled to the appropriate margin over the ECB rate which was applicable on the maturity of the fixed rate (or discounted tracker) period. For these customers, the key factor is the date their fixed rate term or discounted tracker rate term would have matured, and the appropriate tracker rate which was applicable at that date."

Note it states *the date their fixed rate term or discounted tracker rate term would have matured*. This is something that surely should be challenged? I have repeatedly looked at my contract and it states that it will revert to tracker on expiry of fixed rate. It also states that fixed can be broken at any time subject to a fee. PTSB didn't charge a breakage fee which is not my problem. There is nothing that states if you break your fixed term early you have to wait until maturity of the original agreed term to revert to tracker. Any thoughts please?


----------



## random2011 (28 Jul 2015)

Brendan Burgess said:


> Hi random
> 
> I have mentioned it in at least two interviews and probably three. I have also briefed the newspapers on it.
> 
> Brendan



Thanks Brendan..hopefully we'll see this because it needs to be highlighted.


----------



## katnia (28 Jul 2015)

I've been trying to figure out what refund people might get and it looks like it will be minimal if you read the FAQ's on the Ptsb website.  I will outline a scenario below, can someone please tell me if I'm correct in my refund assumption? - not the figures but the basis of refund. 
John doe has a 300k mortgage and in 2009 he should have went to tracker but instead went to variable. His mortgage balance today is 290k. Had he went on his tracker his mortgage balance today would 275k, so a difference of 15k.
Ptsb send him his redress letter and work out he overpaid for 68 months at an average of 300 per month = overpayment of 20,400,however,  15k of this overpayment will go to reduce his mortgae balance to what it should have been (275k) and he will get a refund of 5,400 + low level of Ptsb compensation (3,200),meaning John will get 8,600 in total. Doesn't seem like a good deal to me! Is my basic assumption correct?


----------



## katnia (28 Jul 2015)

I think this scenario above is incorrect and we will get a refund of over payments made. I've spoken to Ptsb this afternoon. They can't give figures as we all know but according to them they won't be using our over payments to bring the mortgage down to what it should have been had we been on a lower interest rate. I think the faq's on their website are slightly confusing in this regard. They were to me anyway.


----------



## PadKiss (28 Jul 2015)

Hi all busy day
In regard to the matter of the margin this will be addressed as all that has occurred to date is point one of what I required which was the lower interest rate to apply to each account affected. This may not be the correct margin in some cases but at least has resulted in a stopping of the overcharging occurring. The next stage (of 12 I have requested) is the letters and their content which will require review for each case and then response to the Redress Board (Redress ironically means "_*Remedy or set right (an undesirable or unfair situation") *_Oxford Dictionary) which is what will happen certainly from my point of view. In regard to calculating the refund figure it is difficult to do as there is overcharged interest as well as overpaid payments. None of it should come off the loan balance and at present my view of the figures mentioned in terms of Compensation is totally unacceptable. There appears to me to be a position of lets see how that is viewed rather than seeking to resolve the matter fully. The sincerity of the apology will be clear in the letters, but remember the investigation is not complete or finalised. I will be in touch soon Padraic


----------



## Clint Westwood (28 Jul 2015)

PTSBCase said:


> Just saw this on the PTSB website re redress:
> 
> "In other cases, the customer’s conditions provided that they are entitled to the appropriate margin over the ECB rate which was applicable on the maturity of the fixed rate (or discounted tracker) period. For these customers, the key factor is the date their fixed rate term or discounted tracker rate term would have matured, and the appropriate tracker rate which was applicable at that date."
> 
> Note it states *the date their fixed rate term or discounted tracker rate term would have matured*. This is something that surely should be challenged? I have repeatedly looked at my contract and it states that it will revert to tracker on expiry of fixed rate. It also states that fixed can be broken at any time subject to a fee. PTSB didn't charge a breakage fee which is not my problem. There is nothing that states if you break your fixed term early you have to wait until maturity of the original agreed term to revert to tracker. Any thoughts please?


I fully agree with you,when people broke out of the fixed rate, that WAS the expiry of the fixed rate. Which in early 2009, the tracker rate would have been a lot less than the 3.3% that ptsb are offering for a year later. So I certainly feel the tracker rate that should apply is the one in Feb 09.


----------



## AAM_User (28 Jul 2015)

The more I read about this, the less I like it.  On the official page, there's talk of using the refund to pay off arrears before refunding the customer if there's anything left.  This is OUR money, it's not up to them what to do with it.  Arrears should be written off as part of the deal, they wouldn't have occurred if they  hadn't defrauded us.

They also report the letters as being received.


----------



## Descart (28 Jul 2015)

Bronte,

You are correct, as the stones are lifted one by one off each financial institution you will see them scurrying away. AAM_user is correct in the choice of the word defraud.


----------

