EBS What does an EBS "Variable Base Rate" mortgage mean?

[RAzvan R]

I’ve attached Padraic Kissane’s comments on the “variable base” rate issue at the Oireachtas committee yesterday.

Hi B,
Thank you for update.
I wonder how the EBS and most important CB will respond.

Regards,
Razvan R.

 

[haveaniceday]

Hey there - I contact the ebs redress number today to find out if my mortgage was one being investigated / impacted and it was not - the guy said they had no record on file of my Brokers fax requesting a tracker..
A number of times he said if I did not get a tracker in july 2008 then it was basically my brokers fault as they were available - he pointed to my broker being to blame a number of times during the call.

He said I should send it in along with a letter of complaint - but he also wanted me to be aware that it would most like take MONTHS for them to get to it ?

 

[B26354]

Hey there - I contact the ebs redress number today to find out if my mortgage was one being investigated / impacted and it was not - the guy said they had no record on file of my Brokers fax requesting a tracker..
A number of times he said if I did not get a tracker in july 2008 then it was basically my brokers fault as they were available - he pointed to my broker being to blame a number of times during the call.

He said I should send it in along with a letter of complaint - but he also wanted me to be aware that it would most like take MONTHS for them to get to it ?

EBS’ defense is to blame the brokers on this. Maybe the brokers should know that EBS are blaming them and thousands of customers are seeking redress worth millions of euro in total? I’m sure if that happened the brokers would pretty quickly find more EBS material & correspondence confirming the “variable base rate” to be a tracker.

 

[RAzvan R]

EBS’ defense is to blame the brokers on this. Maybe the brokers should know that EBS are blaming them and thousands of customers are seeking redress worth millions of euro in total? I’m sure if that happened the brokers would pretty quickly find more EBS material & correspondence confirming the “variable base rate” to be a tracker.

Brokers evidence is more than welcome (to speed up the process).
Currently, we have bullet proof evidence that Variable Base was a Tracker.
Is up to CB to decide what is the next step because this is just the begining for EBS.

 

[haveaniceday]

Hey there - I did call my broker earlier this evening and explained to him that EBS told me that if I had no tracker that it was purely down to my broker and they had no part in it ..
They said yes they were available in July 2008 and it was my broker I needed to speak with not them.
My broker ( who seemed pretty surpised by this turn of events) told me that he would review everything he had from that time and get back to me - so yes I think getting back onto the brokers and seeing what they have is a good idea - also maybe a good idea to let them know what is going on and how they are being blamed for this mess.

 

[Webster]

Brokers evidence is more than welcome (to speed up the process).
Currently, we have bullet proof evidence that Variable Base was a Tracker.
Is up to CB to decide what is the next step because this is just the begining for EBS.

Without a doubt there is a body of evidence within this thread alone, that EBS have a case to answer. Padraic Kissane highlighted to the Oireachtas committee in laymans terms the concept of Contra Proferentem, I hope the Central Bank grasp this concept on any investigation of the matters raised here.

 

[haveaniceday]

here is the details of Mr. Padraic Kissane input to the
Oireachtas Joint and Select Committees

Tuesday, 21 February 2017

https://www.kildarestreet.com/committees/?id=2017-02-21a.300
in it he says
KBC did not even have a standard variable rate mortgage when people were fixing loan rates. All home loans reverted to trackers, as the infamous e-mail claimed.

Sounds like the EBS variable base rate situation ...

 

[Webster]

Nice one haveaniceday, does any one have any EBS broker "flyers" relating to same. (the final nail in EBS's coffin)

 

[RAzvan R]

Nice one haveaniceday, does any one have any EBS broker "flyers" relating to same. (the final nail in EBS's coffin)

I have the original EBS Home Loan Repayment Type flyer & forms which was advertise across all EBS branches and subsidaries & brokers, same as KBC.
The forms were prezented to customers in A3 format.
Fix Rate
Tracker Rate
Easy Step (defered payment)
Flexi option - interest only.
SVR did not exist in that time frame.
Very important fact:
Haven was EBS subsidaries curently under AIB umbrela.
Atracting more customers Strategy & Comunication was directed by EBS Central Office to all subsidaries, tied agencys & brokers.
This is the reason why EBS use to be first in the ROI mortgage market.
I was suprised also to hear that only 3000 customers have been affected.
I was expecting more.
I believed, the number of EBS customers with Variable Base(Tracker Rate) could excede the cost of 1.6 billion.
AIB CEO he realised the cost implication and is triyng to convince CB to sell some shares.....
The chain is getting smaller.

Regards,
Razvan Radulescu.

 

[IdesofMarch]

I have the original EBS Home Loan Repayment Type flyer & forms which was advertise across all EBS branches and subsidaries & brokers.
The forms were prezented to customers in A3 format.
Fix Rate
Tracker Rate
Easy Step (defered payment)
Flexi option - interest only.
SVR did not exist in that time frame.
Very important fact:
KBC & Haven they were EBS subsidaries curently under AIB umbrela.
Atracting more customers Strategy & Comunication was directed by EBS Central Office to all subsidaries, tied agencys & brokers.
This is the reason why EBS use to be first in the ROI mortgage market.
I was suprised also to hear that only 3000 customers have been affected.
I was expecting more.
I believed, the number of EBS customers with Variable Base(Tracker Rate) could excede the cost of 1.6 billion.
AIB CEO he realised the cost implication and is triyng to convince CB to sell some shares.....
The chain is getting smaller.

Regards,
Razvan Radulescu.

Razvan,

Just to correct the record, KBC was never a subsidiary of EBS, it's a Belgian bank.

 

[RAzvan R]

Razvan,

Just to correct the record, KBC was never a subsidiary of EBS, it's a Belgium bank.

My mistake, apologies.
It was proposed to aquired KBC - not finalised.

 

[B26354]

3000 is very low. I spoke to another EBS customer recently who didn’t even know he could be affected and had received no correspondence from EBS.

I was told by broker I would move to tracker after fixed rate ended. I rang EBS in 2010 and was told I would only be offered a standard variable rate as per the conditions in my loan offer. Saw the word “variable” in my loan offer and no mention of tracker and that put me off the scent for 5 years. In 2015 a friend suggested I review the loan offer again as trackers are sometimes definied as variable rates. How right he was....but there is likely to be many others who have not investigated this further and think they are on the right variable rate.

So it could be that those 3000 customers are ones who have made a complaint with thousands not so blissfully unaware; Razvans figure of over €1.6 billion suggests it could be many multiples of 3000.

 

[B26354]

Nice one haveaniceday, does any one have any EBS broker "flyers" relating to same. (the final nail in EBS's coffin)

Yes. There is an EBS systems mortgage illustration document that EBS appointed brokers gave to customers who started on fixed term to move onto “variable base (currently xx%)”

It reads:
“After x years, a variable rate 1.25% above ECB Base Rate currently xx%, for the remaining term of the mortgage to give a current rate payable of xx%”

 

[RAzvan R]

3000 is very low. I spoke to another EBS customer recently who didn’t even know he could be affected and had received no correspondence from EBS.

I was told by broker I would move to tracker after fixed rate ended. I rang EBS in 2010 and was told I would only be offered a standard variable rate as per the conditions in my loan offer. Saw the word “variable” in my loan offer and no mention of tracker and that put me off the scent for 5 years. In 2015 a friend suggested I review the loan offer again as trackers are sometimes definied as variable rates. How right he was....but there is likely to be many others who have not investigated this further and think they are on the right variable rate.

So it could be that those 3000 customers are ones who have made a complaint with thousands not so blissfully unaware; Razvans figure of over €1.6 billion suggests it could be many multiples of 3000.

This is why I believed 3000 customers is low figure.
“ At the same time, EBS was the largest provider of retail first-time buyer mortgages in Ireland, with a 44% market share, and the market leader in supplying mortgages for affordable housing in the country “
How? Simple, with Variable Base/Tracker rate.

 

[B26354]

This is why I believed 3000 customers is low figure.
“ At the same time, EBS was the largest provider of retail first-time buyer mortgages in Ireland, with a 44% market share, and the market leader in supplying mortgages for affordable housing in the country “
How? Simple, with Variable Base/Tracker rate.

25k new EBS mortgage customers in 2006 alone (see image).

In the 2006 EBS Annual Report Alan Merriman also references “very competitive tracker offerings” and a SVR(see image). Yet more evidence that EBS were promoting and selling tracker products but also an SVR which doesn’t seem to exist or certainly wasn’t available to new customers. The oireachtas finance committee may also need to ask EBS officials about who coordinated this media campaign that created a myth that EBS sold very few trackers.

 

[B26354]

25k new EBS mortgage customers in 2006 alone (see image).

In the 2006 EBS Annual Report Alan Merriman also references “very competitive tracker offerings” and a SVR(see image). Yet more evidence that EBS were promoting and selling tracker products but also an SVR which doesn’t seem to exist or certainly wasn’t available to new customers. The oireachtas finance committee may also need to ask EBS officials about who coordinated this media campaign that created a myth that EBS sold very few trackers.

And here again is the same Alan Merriman talking about those “very competitive trackers” in 2015(see image). Quite the change. Alan obviously “raised his concern” at boardroom level around mid 2008 because he seemed pretty happy with his EBS tracker rates in 2006-2007.

 

[EbsLoannotrafor]

25k new EBS mortgage customers in 2006 alone (see image).

In the 2006 EBS Annual Report Alan Merriman also references “very competitive tracker offerings” and a SVR(see image). Yet more evidence that EBS were promoting and selling tracker products but also an SVR which doesn’t seem to exist or certainly wasn’t available to new customers. The oireachtas finance committee may also need to ask EBS officials about who coordinated this media campaign that created a myth that EBS sold very few trackers.

The comments from mr Merriman at the finance committee in 2015, need also to be part of the questioning . More importantly the current CEO of ebs ( is that Aibs? ) mr Byrne needs to be questioned systemically on this issue . Is there a role to call to finance committee Cb to answer why this group not yet deemed impacted ?

 

[haveaniceday]

HI There
Here is the transcript of
JOINT COMMITTEE OF INQUIRY INTO THE BANKING CRISIS on
29/07/2015 with Fidelma Clarke – Former Chief Risk Officer, EBS
https://inquiries.oireachtas.ie/banking/hearings/fidelma-clarke-former-chief-risk-officer-ebs/

- an EBS board minute of 31 May 2002 was read out at the enquiry that the EBS MORTGAGE strategy in 2002 was as follows:

“Tracker mortgages will account for an increasing proportion of business – rising from 5% today to 60% by 2008.”

so again begs the question where did all those trackers go - after all those years and years of working to grow their trackers mortgage market suddenly in 2015 EBS had hardly any!

 

[haveaniceday]

The source of the idea that ebs had a low level of tracker mortgages appears to be assigned to
'Professor Nyberg's report - i.e. REPORT OF THE COMMISSION OF INVESTIGATION
INTO THE BANKING SECTOR IN IRELAND
Written in 2011
and this report
https://www.nuigalway.ie/media/hous...of-the-Systemic-Banking-Crisis-in-Ireland.pdf
item 2.7.26 states
Tracker mortgages wereavailable from four of the covered banks but were particularly a feature in the three largest
residential mortgage lenders among the covered banks, where they accounted for in excess of
50% of the mortgage books as against approximately 20% in the case of EBS'

Question is of course where did Professor Nyberg get his information from - that now appear as facts that Fidelma Clarke – Former Chief Risk Officer, EBS is so happy to quote to the committee ( as though Professor Nyberg had gone in personally audited EBS!!!)
- I am assuming EBS gave him those figures ( after the tracker mortgages where magically turned into SVR mortgages)

below is statement from Fidelma Clarke – Former Chief Risk Officer to the Committee

'And EBS was involved in tracker mortgages albeit I believe to a substantially lesser extent than other institutions, as per Professor Nyberg’s report. I think he quotes EBS having an exposure to tracker mortgages of 20%vis-à-vis 50% in some of the other institutions.'

Seriously !!!

 

[B26354]

Ethna Tinney non executive director of EBS during the period in question seems to have been the voice of reason. Her testimony to the finance committee is worth a read in its entirety. I’ve attached it here.

https://inquiries.oireachtas.ie/ban...ormer-independent-non-executive-director-ebs/

Sub-prime loans/vulture fund packages of loans influencing interest rates, and she confirms trackers make up 60% of EBS loan book & how SVR ‘s are now shoring up losses on trackers. I’ve attached some of the more interesting quotes. I can see why EBS has been hidden away. A can of worms is about to be opened.