Bank of Ireland has announced new deposit rates for customers, offering a market-leading rate of 3% on certain products. Starting from the 8th of September, both new and existing Bank of Ireland customers with a SuperSaver account will be able to avail of 3% interest, up from the previous rate of 2%, for an initial 12-month period. After the initial period, a rate of 2% will apply on balances up to €30,000.
In addition, interest for Mortgage Saver account holders will increase from 1% to 2% on balances up to €15,000. Balances in excess of €15,000 will have a rate of 0.5% applied to them.
Susan Russell, CEO Retail Ireland at Bank of Ireland, spoke about these changes, stating, “Since the ECB started to increase rates last year, we have made a number of improvements to our savings products. These latest changes will increase our SuperSaver to a market leading 3%. I would encourage customers to switch their money from their current account to a savings or deposit account where they will benefit from interest payments. The market has gone from eight years of negative rates and, now that savers can benefit from better rates, we are encouraging customers to take action.”
For regular saver accounts, interest on amounts up to €12,000 will be doubled to 2%, up from the previous rate of 1%. Balances above €12,000 will have a rate of 0.5% applied to them.
Bank of Ireland has also introduced a new feature called “10% Access” to its 6-month, 1-year, and 2-year term deposit accounts. This feature allows account holders to access up to 10% of their initial balance. The rate for 6-month deposit accounts will be 1.5%, while the rate for 1 and 2-year term deposits will be 2%. This feature is available for both business and personal accounts.
Furthermore, Bank of Ireland will increase its 31-day notice interest rate to 1%, up from the previous rate of 0.5%. Interest on demand deposits will also rise to 0.1% from a previous 0%, and this increase will be applied automatically.
Ms. Russell acknowledged the challenges that a rising interest rate environment brings for mortgage customers and assured that Bank of Ireland takes a measured approach in relation to its mortgage rates. She concluded by stating that the bank will continue to review rates in the future.
Ireland’s pillar banks, including Bank of Ireland, have faced criticism for not passing on the ECB’s interest rate hikes to consumers, while mortgage rates continue to increase. A recent report by Standard & Poor found that Ireland had the lowest deposit rate gains out of the Eurozone, UK, and US, with only 7% of interest rate hikes being passed on to savers. The move by Bank of Ireland puts pressure on AIB and Permanent TSB to match the market-leading rate of up to 3%. All three banks have recorded significant profits in the first half of the year due to the ECB’s aggressive interest rate campaign.