Bank of Ireland increases interest rates on fixed-rate mortgages

Bank of Ireland has increased its interest rates on fixed-rate mortgages, as well as raising rates paid to savers holding certain deposit products.

The bank is applying a three-quarter percentage point rise across its range of fixed-rate loans offered to new borrowers, while the fixed rates available to existing mortgage customers are now half a percentage point higher.

The bank said the increases follow a cumulative hike of 2.5 percentage points in the European Central Bank (ECB) key lending rate since July 2022 as the ECB tightens its monetary policy in response to soaring inflation across the euro zone.

Its variable and tracker mortgage rates remain unchanged. The tracker mortgage rates would have risen in tandem with the ECB hikes over the past six months.

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The change means the interest rate on Bank of Ireland’s one-year and two-year fixed loans will increase from 3.15 per cent to 3.9 per cent for new customers. Its three-year and five-year fixed loans for this group are now 4 per cent, up from 3.25 per cent.

The lender’s 10-year fixed rate is now either 4.3 per cent or 4.5 per cent, with the lower rate available to borrowers whose loan-to-value is less than 80 per cent. Slightly lower rates across its range of fixed-rate loans are available to Bank of Ireland customers eligible for a “green mortgage” discount.

For existing customers – which includes customers coming to an end of their previous fixed-rate period and seeking to re-fix their loan – the one-year and two-year fixed rate is now 3.4 per cent, the three-year and five-year rate is now 3.5 per cent and the 10-year rate is either 3.8 per cent or 4 per cent, with the difference again depending on the loan-to-value.

Applicants who already have credit approval and who draw down the mortgage by February 21st can still avail of the previous fixed rates.

On deposit accounts, the interest paid on its regular saver, goal saver and child saver personal accounts rises from 0.25 per cent to 0.75 per cent, capped at up to €15,000. The bank is also launching a new one-year term deposit account for personal customers paying interest of 0.5 per cent, capped at €100,000.