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How do Bank of ireland establish what interest rates they charge ?

  • 05-02-2018 11:13am
    #1
    handlemaster
    Registered Users, Registered Users 2 Posts: 6,003 ✭✭✭


    Clearly the rates in general with all mortgage providers within Ireland is completely out of sink with the rest of Europe. How does Bank of Ireland set the rates they charge ? The cost of borrowing for institutions is virtually zero and has been for  a few years. If the rates are attractive for French  banks to lend below 2% fixed for 25 years why not Bank of Ireland ? 


Comments

  • #2
    Colonel Claptrap
    Registered Users, Registered Users 2 Posts: 945 ✭✭✭Colonel Claptrap


    Yes, the rates of borrowing are similar for Irish and French banks.

    But the markets in which they operate are very different. Look at how few reposessions took place during our recession. If a bank has little confidence in recouping collateral, they must protect their balance sheets in other ways.

    By paying a high interest rate on your BOI mortgage, you are effectively subsidising people who refuse to repay arrears and/or hand the keys back to the bank.


  • #3
    Bank of Ireland: Kareana
    Closed Accounts Posts: 453 ✭✭Bank of Ireland: Kareana


    Hi handlemaster,

    Thanks for your post here on Boards. 

    We wouldn't be able to discuss the above here on Boards as this would be business sensitive information.

    Please let us know if there is anything else we can help you with.

    Thanks,

    Kareana


  • #4
    Dublingirl80
    Closed Accounts Posts: 244 ✭✭Dublingirl80


    handlemaster wrote: »
    Clearly the rates in general with all mortgage providers within Ireland is completely out of sink with the rest of Europe. How does Bank of Ireland set the rates they charge ? The cost of borrowing for institutions is virtually zero and has been for  a few years. If the rates are attractive for French  banks to lend below 2% fixed for 25 years why not Bank of Ireland ? 

    I'm also wondering why they have the highest rates around at the moment. I'll be switching unless they improve them before my fixed term ends.


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