Sinn Féin Finance Spokesperson Pearse Doherty TD has welcomed the move.
Deputy Doherty has accused the Minister of Finance Michael Noonan of sitting on his hands while people lost their homes despite this issue being in the public domain for the last five years.
Deputy Doherty said: "Three years ago, I sat with a family who were at risk of losing their home and I learned when going through their loan documents that Permanent TSB had wrongly moved them from a tracker mortgage to a fixed rate mortgage.
"I raised this directly with the bank when their officials appeared in front of the Finance Committee here in the Oireachtas in 2013. Others have raised this issue as far back as 2010.
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"Yet in all that time, the Minister has sat on his hands while some families lost their homes and others were put under undue pressure to meet increased repayments.
"Minister Michael Noonan was the sole shareholder in PTSB for the duration of this scandal yet for years under his watch, this State owned bank ripped off hundreds of customers and even after being exposed fought to the bitter end to delay redress.
"We have to remember that the bank went to great lengths to avoid moving their customers back onto tracker rate mortgages including refusing mediation and appealing every decision made against it in the courts.
"Questions must be asked as to why it was diligent customers that spotted this rip off and not the Central Bank with its regulatory powers and why, five years later, we still have no sanctions or fines announced from the Central Bank for Permanent TSB.
"Once again, the government's hands-off approach has seen the ordinary bank customer suffer and unfortunately even lose their home in some cases here because of a bank ripping them off."
(CD/LM)
