AIB has returned an average of €93 each to 43,000 pensioners whose free banking accounts it wrongfully overcharged.

The bank said yesterday that it has returned the cash to all affected customers who still have open accounts with AIB.

It is trying to track down a number of customers who closed their accounts since the bank overcharged them in July 2000.

The bank realised that it had overcharged elderly and disabled customers on their One to One accounts during a review of its procedures.

The accounts were supposed to offer free banking to these customers.

The total amount that the bank overcharged was €4 million, which works out at an average of slightly more than €93 for each of the 43,000 customers.

AIB has tarnished its reputation in recent years with a series of overcharging scandals.

Yesterday, older people's lobby group Age Action Ireland said it was concerned that pensioners were the latest group to have suffered as a result of the bank's overcharging mistakes.

"We have to ask how it happened and why did it take them seven years to detect it," a spokesman said.

He added that pensioners are on fixed incomes and cannot afford to lose money in this way.

A spokeswoman for the financial regulator, which polices the banks, said it was "deeply disappointed" at the news.

The regulator has the power to reprimand and fine banks that break the rules governing how they may charge their customers.

However, this overcharging episode predates the legislation giving those powers to the regulator.

AIB's spokeswoman said that the bank had put procedures and processes in place to prevent such mistakes in the future.

"We're making every possible effort to make sure this does not happen again," she said.

The bank first suspected it overcharged these customers last August. It confirmed this after a further inquiry in December.

"We then, as is agreed practice, informed the financial regulator of the nature of the issue and of the steps we were taking to ensure that our customers were fully identified and refunded," the bank said in a statement.

"Identifying all of the affected customers, the particular accounts and the periods for which these accounts were incorrectly charged was a complex process and was completed as quickly as possible."