|Bank of Ireland was founded in 1783 and the premises at College Green, Dublin, of the Irish Parliament, which became defunct on the Act of Union coming in to effect in 1801, were purchased for £40,000 in 1803. |
Bank of Ireland plans to raise
business interest rates through changing the calculation of the cost from the
Euribor inter-bank rate which is calculated daily by the European Banking
Federation in Brussels using rates charged on inter-bank loans in the wholesale
market, supplied from a panel of 44 Eurozone banks.
BoI says rates such as the Prime
Rate will in future no longer be based on the
but will be calculated using its own costs of raising money through
customer deposits, the money markets and other funding sources.
On Tuesday, BoI published a Prime Rate of 1.42%
down from a recent stable level of 1.97%. The bank told Finfacts on Thursday:"You were
right to pick up the lower rate based on the Tuesday, 11thOct
commentary. However, from an initial look, it appears that the Prime Rate
recorded on Tuesday may have been incorrect. As such, please reinstate the
Prime Rate to 1.97% from today."
A Bank of Ireland customer also told Finfacts on Thursday that BoI had advised
him that the Prime Rate applying to 3 outstanding mortgages, would be raised
because of a change in the calculation basis.
The bank estimates that about 20% of
business customers will be affected.
The new system takes effect from November 16th on
loans of more than €300,000, which are expected to incur a rise of about 0.7%.
Meanwhile, The Irish Independent
reports today that banks are to be stopped from targeting 200,000 variable mortgage holders with
repeated rate hikes which are costing families an average of €120 a month in
Matthew Elderfield, the Financial
Regulator, is to outline a new clampdown on banks who are piling the pressure on
The newspaper says the get-tough policy by Elderfield also means he will put pressure on
lenders to cut variable rates when the ECB lowers Eurozone rates, a move that
could happen before Christmas.
Banks have been hiking their variable rates -- some to as high as 6% -- as
they desperately try to make up for losses.
Since the start of the year most lenders have hiked rates numerous times over
and above the increases by the ECB.
This means variable rate customers with a €200,000 mortgage are paying €120 a
month more than those on trackers and fixed rates because the banks can't touch