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Bank Of Ireland accused of "Dirty Tricks" over tracker mortgage research


Sync

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Storm over bank's 'dirty tricks' on tracker loans - Independent.ie

BOI instructed RedC to do some research into the tracker mortages held by their customers, essentially looking for their level of understanding of and attachment to their tracker mortgage. BOI's got about 80k of these and they are quite frankly a milestone around their neck (As they would be for any bank anywhere). Of course it's BOI's own fault, they offered the product, people took up the product and now they have to provide the product. Tough quite frankly.

On the flip side, I've no issue with what BOI state as their aim:
The objective of the research is to produce findings that would "encourage tracker mortgage holders to move off their product".

This would "ultimately improve the overall profitability of the Bank of Ireland mortgage book", the study states.
Which is fair. If they're upfront and honest and say "You've a 300k mortgage, we'll give you a 20k lump sum if you move to a mortgage that will cost you 30k extra in the long term" then again, they're offering a product that people will take up. The problem they have though is that according to their own research, 85% of people on the Luas during that ad DO know what a tracker mortgage is and aren't likely to move from it.

Labour have blown their stack (Because if there's anyone that needs to be desperately populist right now, it's Labour):

Labour TD Kevin Humphreys said he was concerned that the bank was engaged in "dirty tricks". He had requested the research from the bank after Mr Boucher referred to it when he appeared before the Oireachtas Finance Committee last November.

Mr Humphreys said the research showed the bank was only interested in its own profitability and was not acting in the best interests of its customers
Which isn't true, some people may well like a lump sum rather than a larger saving over time. But my favourite bit is the BOI excuse which is utter utter bollox.

A spokeswoman for the bank admitted the document used blunt language and showed the bank up in a bad light. But she insisted this was because the research was only for internal use.

There was no attempt to trick people out of their good-value trackers, the bank said. Bank of Ireland was merely trying to find ways to ensure that having a tracker would not be an impediment for those who wanted to move house.
Pull the other one dear. I hope she said it deadpan, that's a line straight out of "Thank you for smoking".

I can see banks offering deals to get people out of their trackers. I can also see compensation for misselling of those deals in years to come.
 

Howya

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Didn't BoI move UK residents with tracker loans onto variable rates? And did so because there was some contractual language that allowed them to do so. I didn't hear that BoI offered any sort of incentive.

It would be interesting to see the difference in the language as it seems Irish trackers are a different breed.
 

eoghanacht

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I expect the FR to come down hard on them or maybe just have a round of golf and a nice lunch in the K club and pretend they had strong word.

The more they change.....
 

Sync

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Didn't BoI move UK residents with tracker loans onto variable rates? And did so because there was some contractual language that allowed them to do so. I didn't hear that BoI offered any sort of incentive.

It would be interesting to see the difference in the language as it seems Irish trackers are a different breed.
They were. BOI's contention (Which was upheld by the UK regulator) was that they made clear to people when they took up that product that apparently it was really a tracker mortgage and really BOI could hike the rate. Which they've done, pretty spectacularly, hiking it by about 2.5%.

If I were a solicitor with the resources in the UK, I'd be looking to put together a class action for customers who saythat they weren't told this, that they thought a tracker mortgage WAS a tracker mortgage and claim for compensation under TCF.
 

ShoutingIsLeadership

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Labour should shut its trap on this one. Eamon Gilmore was acting the Billy Big B0ll*x in December 2011, when AIB announced it was putting rates up by .25%. 'Over my bloated dead body', Gilmore sort of said.

In the subsequent 8 months, AIB put its variable rates up by 1.25%. This, while the ECB was dropping its rates. For mugs like me, that's an extra €250-€300 per month.

I emailed Gilmore to ask him what he thought about appearing to have told lies on the matter. All he could spin back was banking profitability, blah, blah.
 

Sync

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If I were a solicitor with the resources in the UK, I'd be looking to put together a class action for customers who saythat they weren't told this, that they thought a tracker mortgage WAS a tracker mortgage and claim for compensation under TCF.
BoI reverses mortgage rate hike for 1,200 borrowers | News | Money Marketing

I am Sync the psychic octopus.

BOI have backed down on a small number of claims, basically split into people who signed up for 2 specific products where it's been demonstrated that BOI didn't provide the correct terms to customers when they were signing up. So that's about 1200 customers.

But that still leaves all the other 12000 + customers on the hook for a huge increase in repayments. So now they are indeed bandying together to launch a class actions suit.
The latest on the BOI Tracker rate scandal

Financial Times have a good article on it as well. This is getting a bit of attention in the business pages because if BOI get away with it then you can expect to see other banks doing something similar.
 

paulp

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May 5, 2007
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7,324
ECB

ecb-s-noyer-says-he-s-not-convinced-about-merit-of-negative-rate

“We have prepared so that in case of a need we could implement it,” Noyer said in an interview with Bloomberg Television in Paris today. “This is technically very delicate. I’m personally not convinced there’s an interest in doing that.”
now they're talking about ...
next, it'll be, why are we doing it already ..
 

hammer

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Jul 6, 2009
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Maybe overdrafts will be a thing of the past.

All "loans" into the future consisting of personal loans, with set repayment periods.

Just checked their rates. Anything up to 15.9% pa APR :(
 

Sync

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Mmmm.
A spokeswoman for Bank of Ireland was unable to address queries in relation to the changes yesterday, aside from saying the advertisement had been placed to ensure that the bank’s terms and conditions had been updated to comply with the rules known as Basel III, the international regulatory framework for banks. She said there would be “no customer impact”.
Now it's a LITTLE bit tenuous, but I can see the logic around altering overdraft arrangements to allow for the bank to recall the balance if required to support the liquidity of the bank. The chances of it ever being used or ever being necessary are basically zero though.

The only time it would be required would be if the bank was in SUCH bad shape that it needed to call in it's overdrafts in order to maintain liquidity. But for that to happen A: The bank wouldn't be recieving support from the State or EU (unlikely) and B: The overdraft figure would be relevant to the discussion of the banks survival (very unlikely).

From the look of this, this is just BOI adjusting their contracts to be in line with other banks.

http://www.bba.org.uk/customer/article/understanding-a-personal-overdraft

An overdraft facility is therefore available for you to take up at any time within an agreed period, to the full amount set by your limit. In return for this flexibility, the bank has a right to withdraw the facility at any time or to require immediate repayment in full.
 
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Spanner Island

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Feb 22, 2011
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'Banks' and 'Dirty Tricks' (and a lot worse) go hand in hand imo...

They're 'run' by total scumbags...
 
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