KBC cuts home loan rates to strike back in mortgage wars
KBC Bank Ireland is offering reduced fixed mortgage rates to customers in an attempt to stop people from switching their home loan.
Customers opting into a five-year fixed mortgage will get a rate of 4.5pc, compared to an existing rate of 5.4pc, while those opting for a two-year fixed rate will get a rate of 4.4pc, compared to the existing 4.65pc.
Those already on fixed mortgages will see no change.
A further discount of 0.2 percentage points is available for the life of the mortgage to those who get their salary paid into a KBC current account and pay the mortgage by direct debit.
This applies to those on both fixed and variable mortgages. The bank said it could save homeowners up to €322 a year.
This is based on a 20-year €250,000 mortgage being reduced from KBC's current standard variable rate of 4.5pc.
KBC Ireland head of retail banking Dara Deering said: "We are committed to rewarding customers who do more of their banking through KBC.
"We are seeing a positive response from consumers to our mortgage offering and full range of retail banking products.
"We have had a strong customer reaction to our 0.2pc current account mortgage discount offer so far, with over 90pc of those switching their mortgage to KBC also opening a KBC current account."
Banks have been battling to attract mortgage holders in recent months, with a series of cuts to both fixed and variable mortgage rates.
Earlier this month Ulster Bank announced it was cutting its standard variable rate to 4.3pc, effective from next month, in its first variable rate cut in nearly two years.
AIB cut rates for new and existing customers in October as the bank's financial position improved. Permanent TSB and Bank of Ireland recently announced rate cuts for new customers.
However, mortgage rates here are still much higher than the European average.
Figures recently released by the Central Bank showed that the average variable rate on a new mortgage here was 4.26pc in December, compared to a eurozone average variable mortgage rate of 2.47pc.
Earlier this week Fine Gael MEP Brian Hayes called for the Competition and Consumer Protection Commission to intervene. He said there should be "a thorough investigation into the arguments that current standard variable rates do not reflect market conditions".
"It must be considered that ECB interest rates are at an all-time low of 0.05pc. This low interest rate environment has been reflected in many eurozone countries through lower variable rates, but in Ireland banks are still comfortable offering variable rates of over 4pc," Mr Hayes said.
Switchers are not affected by the Central Bank's new mortgage caps.
Rejection of rent support to be banned
Landlords will no longer be able to discriminate against tenants in receipt of rent supplements, under new legislation being drawn up by the Government.
Minister of State Aodhán Ó Ríordáin said legislation would be amended to ensure people seeking to rent were not disadvantaged because they are in receipt of certain social welfare benefits.
Currently landlords can advertise lettings where rent supplements "are not accepted".
"This practice has a harmful effect on persons seeking to rent accommodation and the Government has therefore decided to prohibit such discrimination," the minister said.
He added he expected the amendments to equality legislation will be published in the current parliamentary term and the Bill enacted shortly.
The move was welcomed by the Peter McVerry Trust, but said the measure would require "rigorous enforcement".
The trust's chief executive Pat Doyle said: "The ability of landlords to prohibit people in need of State supports from renting their accommodation has had enormous negative consequences for thousands of individuals, couples and families over the years."