Banks are stepping up efforts to cut back on interest
BANKS and building societies have begun the year with a slew of cuts of close to 1pc in deposit savings rates.
Simon Moynihan, of price comparison site Bonkers.ie, said a domino effect was taking hold, with banks following each other in cutting deposit interest rates.
"Rates are falling by an average of 0.5pc," he said. "They are all doing it because there is safety in numbers."
The fact that the European Central Bank did not cut its key rate yesterday could spare depositors even more savage savings rate reductions.
One of the biggest cuts was for the Ulster Bank Loyalty Saver account, which saw its interest rate fall 0.95pc to 1.6pc.
Interest on KBC's Smart Access Demand Account – the top rate for money that can be withdrawn at short notice – is down from 3.25pc to 3pc.
Large rate reductions show banks and building societies were getting more aggressive in their deposit-rate cutting.
Most have been reducing rates since last summer, as they are now less reliant on household nest eggs.
There is some €87bn in household savings and €15bn in state savings schemes sold by An Post.