Around 8,200 mortgage holders have been identified as being denied the correct tracker rate of interest under lenders' regulatory requirements.
In a statement outlining progress on its Tracker Mortgage Examination, the bank said a lender is obliged to immediately stop charging the incorrect rate of interest on the account.
This must be communicate this to the customer, to ensure that any further customer detriment is stopped as early as possible.
A full review of the customer’s account is then carried out and a letter issued to the customer explaining the nature of the error. The correct rate applied to the customer’s account and information offered on redress and compensation process.
The bank's Director of Consumer Protection Bernard Sheridan said: “I welcome the fact that these figures show an increase in the pace at which impacted customers are being identified, with more customers starting to be moved to the correct interest rate, and redress and compensation commencing.
"The Central Bank continues to challenge all lenders to ensure that they identify all impacted customers in a timely manner. As we have said previously, given the size and complexity of the Tracker Examination, it will take time to complete, with lenders at varying stages given the individual lender challenges this Tracker Examination poses.
"However, based on current progress we expect that relevant lenders will have identified and commenced engagement with impacted customers by mid-2017 with payment of redress and compensation, processing and consideration of any appeals and the Central Bank’s own assurance work continuing beyond this point for some lenders.”
The examination framework also rules that lenders must set up an independent appeals process to deal with customers who are unhappy with any aspect of the redress package they receive.
The statement added: "The Central Bank continues to monitor lenders’ progress in respect of the conduct of the Tracker Examination through direct engagement with each lender and its appointed external independent party and through on-site reviews and review of regular progress reporting.
"Where necessary the Central Bank will take appropriate supervisory action, including enforcement action, to ensure that fair outcomes are achieved for consumers, as demonstrated in the outcome of a recent settlement agreement with Springboard Mortgages Limited where the Central Bank issued a reprimand and imposed a fine of €4.5m.
"Further updates will be issued in 2017 as the Tracker Examination further progresses."
Since 2010, bank has identified issues where borrowers opted to switch from their tracker rates or who had the right to revert to a tracker rate at the end of the fixed rate period.
The bank also decided that a system-wide review was necessary, to ensure that all lenders are acting in their customers’ best interests, and wrote to 15 lenders in December 2015 setting out the framework for carrying out the Tracker Examination.
The 15 lenders were:
· AIB Group (Allied Irish Banks plc, AIB Mortgage Bank, EBS Limited, EBS Mortgage Bank and Haven Mortgage Limited)
· Bank of Ireland Group (The Governor and Company of the Bank of Ireland and Bank of Ireland Mortgage Bank)
· Permanent tsb plc
· Ulster Bank DAC Limited
· KBC Bank Ireland plc
· ACC Loan Management Limited
· Bank of Scotland Plc
· Danske Bank
· Dilosk Limited
· Irish Bank Resolution Corporation Limited
· Leeds Building Society
· Pepper Asset Servicing
· Springboard Mortgage Limited
· Start Mortgages Limited T/A Start Mortgages
· Stepstone Mortgage Funding Limited