New powers allowing the Financial Service Ombudsman to name and shame institutions it rules against has led to a significant fall in the number of complaints by consumers, its latest review reveals.

Avant Card – formerly MBNA – was named as the lender with the most complaints upheld against it since September of last year, when the new powers came into force.

Mis-selling
Most of the problems centred on the mis-selling of payment protection insurance.

Six complaints against Avant were fully upheld, while 27 were partially upheld, making it the worst offender by a substantial margin. Bank of Ireland had nine complaints connected with the sale of payment protection insurance partially upheld, while AIB was partially ruled against eight times.

The ombudsman’s report – published this morning – shows that for the first time since 2007, the number of complaints made against financial institutions fell. There were 3,042 complaints made during the second half of last year, a 35 per cent decrease on the preceding six months.

Some 78 per cent of the complaints were not upheld.

Ombudsman Bill Prasifka attributed the decline to major rule changes, including its new policy of identifying institutions, and said the changes had resulted in lenders responding faster to complaints.

Financial sector
Across the whole financial sector, AIB fared poorly, with five complaints fully upheld and a further 19 partially upheld. Permanent TSB was the third- most-complained-about lender with five complaints fully upheld and seven partially upheld.

There were six complaints over mortgages partially upheld against AIB, while the ombudsman ruled fully against Bank of Scotland on two occasions and partially against it a further eight times.

Ulster Bank had six complaints about its treatment of mortgage account holders partially upheld and one fully upheld.

Mr Prasifka said the banking sector had seen “particular improvement” in recent months, but complaints about mortgage arrears and repayment terms offered by banks remained of particular concern.

Mortgage arrears accounted for 50 per cent of all banking complaints last year, with complaints about account management making up a further 28 per cent.