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Taoiseach urges banks to pass on interest rate cut

The ECB has announced a cut in interest rates – but AIB, Ulster Bank and National Irish Bank have all said they won’t pass on the cut to mortgage customers.

Image: Mark Stedman/Photocall Ireland

THE TAOISEACH HAS urged banks to pass on last week’s ECB cut in interest rates to customers with variable-rate mortgages.

However he ruled out the idea of introducing legislation which would force the banks to do so.

Three banks have said that they will not be passing on the 0.25 per cent cut in the European Central Bank’s main rate, which was announced last Thursday.

AIB and Ulster Bank have said that they won’t pass on the cut to customers with variable-rate mortgages. National Irish Bank, which is owned by Danish bank Danske, says that ECB interest rate fluctuations do not determine pricing on its products and that it “keeps its variable and fixed interest rates under constant review.”

Customers on tracker mortgages will however benefit from the reduction.

Speaking in the Dáil today, Enda Kenny said that he “welcomed” the decision of some banks to pass on the reduction and “encouraged” the other banks to follow suit.

He also said that the Government would be meeting with bank bosses in the new year.

The cut, which brings the ECB rate to 1 per cent, is due to take effect from tomorrow.

EBS and Permanent TSB have said that they will pass on the reduction to customers. Bank of Ireland has said that it will cut its rate by 0.15 rather than the full 0.25 announced by the ECB.

Eamon Gilmore last week said that the government would act “forcefully” to ensure mortgage customers benefit from the cuts.

Banks not passing on full ECB rate cut to mortgage customers >

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