Saturday 23 September 2017

Customers face hike in rates as BoI to cut more staff

Donal O'Donovan

Donal O'Donovan

BANK of Ireland is set to be the next lender to hit homeowners with higher mortgage charges after saying it is examining the pricing on its "variable rate" home loans.

It comes as the bailed-out bank announced a loss of €2.1bn in 2012.

Further job losses are also on the way at Bank of Ireland.

State-owned AIB hiked interest charges for its mortgage-holders on variable rates twice last year, and has already warned of a further rise in 2013, despite the European Central Bank (ECB) rate remaining at an historic low.

Other banks are known to be considering their own hikes.

Bank of Ireland chief executive Richie Boucher, pictured, said: "Raising (variable) interest rates has not been ruled in or out."

As many as 70,000 borrowers could be hit with higher monthly bills if the partially state-owned bank does push ahead with an interest rate increase.

Customers with tracker mortgages – where the interest rate is tied to the official ECB rate – will not be affected, unless the main rates change.

Bank of Ireland last week angered customers in the UK by lifting interest charges for some tracker mortgages there, even though the official rates had not changed.

That was possible under the UK tracker contracts but could not happen here, Mr Boucher said.

The bad news for home owners comes as staff at the bank brace themselves for more job losses. As many as 500 additional staff could face redundancy this year, following 1,200 job cuts in 2012.

See Business

Irish Independent

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