Allied Irish Banks is to refund almost €400,000 to more than 400 tracker mortgage customers who were overcharged.

The bank confirmed yesterday it is refunding €395,000, which includes interest. A total of 436 mortgage accounts were overcharged. The average customer refund is €906.

AIB said it provides varying tracker rates to mortgage holders depending on the loan-to-value ratio of their mortgage. “The error arose when customers were charged an interest rate that did not correspond to the loan-to-value ratio for their account. Additionally, in some instances a ‘new business’ discount was not appropriately applied,” the bank said.

“The litany of overcharging incidents from our taxpayer-supported banks seems endless,” said Paul Kinane, chairman of the finance committee at the Irish Brokers’ Association.