1990 is a long way back and whatever rate was there probably doesn't exist any more.
Besides, early 2000s is generally excepted as the introduction of tracker mortgages in Ireland. I doubt if anyone had introduced them beforehand they wouldn't have marketed the hell out of them.
"New Bank Cost of Funds Rate" might closely track the euribor but that doesn't make it the euribor. The cost of funds rate sounds like a marketing gimmick. I remember seeing the Woolwich building society offering a tracker rate in the UK. I had a little chuckle when I read the not so small print. That rate tracked some Barclays rate. It was just window dressing for a variable rate product. I imagine that most of the Ulster products were similar.
Stephen Hawkins disproved time travel by throwing a party for time travelers and no one turned up. In the same way perhaps the fact no one complained here or to the ombudsman means they're weren't really trackers.
Hi skrooge, you are right I got the dates completely wrong, apologies. I believe Euribor mortgages were introduced by UB in 2002.
In relation to to UB’s BCOF mortgages, the CBI’s framework for conducting tracker mortgage examination definition of what a tracker interest rate is, is quite broad in its application, it states,
“For the purposes of the Examination, a “
Tracker Interest Rate” refers to the interest rate applied to a mortgage product:
1) which tracks a rate which comes from a publicly available source which can be verified by both the customer and the regulated entity, including without limitation, a rate that tracks the European Central Bank (ECB) main refinancing operations rate; and 2) which is calculated in a manner similar to a rate which falls within 1) above, and includes interest rates calculated on the basis of a fixed rate margin and/or pricing promise.
2 Both enduring and one-off contractual rights and options are to be included within the scope of the Examination.”
UB BCOF mortgages do track the one month euribor rate. If this interest rate varies, so to does the interest rate applicable to the respective BCOF mortgage. BCOF mortgages track this Euribor index. This is my point. Whether the BCOF mortgage also has other variable rate elements that make up the overall variable interest rate charge to its customers is irrelevant. The fact is, from reading the CBI’s definition of what a Tracker Interest Rate is, UB’s BCOF mortgages appear to be captured within the scope of its tracker examination, but for some unknown reason where not reviewed. This is the issue that I would like answered.
In relation to the unilateral introduction of Ulster Bank’s BCOF mortgage to its customers in May of 2006 from it’s Prime interest rates, I believe there was a number of complaints to the FSPO.
In its annual report of 2006 (page 24 refers) it stated,
SUCCESSFUL RESOLUTION OF A NUMBER OF MORTGAGE COMPLAINTS ON A PARTICULAR ISSUE
In mid-2006 I received, within a few days, a cluster of complaints (18 in all) from customers of a FSP arising from unilateral action taken by the FSP in relation to the repayment terms of one of its mortgage products. For my office to receive a cluster of complaints about a particular matter is most unusual. The complaints revealed that the FSP had written to a number of customers who held mortgages of a particular type of repayment advising that this particular arrangement was to be discontinued. The Complainants who contacted my office were clearly unhappy with what had been proposed.
Having reviewed the complaints, I felt that there might be a systemic issue being revealed, and rather than deal with each case in succession I decided to call in the FSP concerned and ask for an explanation of the cause of the problem. When the FSP came to see me and the Deputy Ombudsman, it was pointed out to them that what was proposed was a material change in the terms of the mortgage contract. Without the agreement of the mortgage holders I would, in all likelihood, be upholding these complaints, one by one, as things stood.
The FSP admitted that there was a problem and that perhaps its approach had not been best practice so far. It asked for time to bring forward new proposals to put to its customers. I considered that a further eight weeks to try to resolve the issue was appropriate.
At the end of that time the FSP came back and stated that 17 of the 18 cases had been resolved amicably as a result of new proposals. I indicated that the new response was a fair and reasonable one and, if implemented, the FSP would have no further case to answer. I wrote to the Complainants accordingly and also to the FSP complimenting it on its approach to the problem.
This is a good example of a FSP recognising a mistake and, following discussion with me, developing a good resolution to what had been a difficult and complex problem to resolve.
17 of the 18 customers accepted renumeration from Ulster Bank. The 18th went to court, see link.
A successful legal challenge by an Ulster Bank customer to get the full interest portion of his loan written of could pave the way for a number of similar cases.
Finally, maybe the time travellers didn’t turn up to Stephen Hawkins party, because it was too much effort to get there versus what they would get out of the party.