Bank of Ireland has confirmed that it will be rewriting to 28,000 of its customers who invested in fixed interest rate SSIA accounts to clarify the original 4% interest rate will be applied, until maturity, to all top-up investment commitments made prior to 21 March this year.
The letters will reverse an earlier decision by the bank to cut the interest rate for topped up SSIA investment accounts over the past three years. The new letters come just ten days after Bank of Ireland originally informed its customers that the interest rate was being cut.
In its marketing literature for SSIA investment offerings Bank of Ireland had quoted a fixed interest rate of 4% per year on original investment amounts.
The literature highlighted that people could top up their investments to a limit of €254 per month anytime after the first year of the five year savings scheme.
The literature also pointed out that the fixed interest rate available for the top-up investment amounts would not necessarily be 4%, but would instead be dictated by the financial market conditions prevailing when the additional investments were made.
However, all those who chose to top-up their savings' contributions before March this year received acknowledgments from the Bank giving the impression that the top-up amounts would attract a fixed interest rate of 4%. In all, 28,000 customers received such acknowledgments.
Then on 29th April this year Bank of Ireland wrote again to all these customers stating that a mistake had been made and that the rate of interest on their top-up investments would be reset to 1.75% from 21 March this year.
The letters also said that this new lower interest rate would apply on the top up amounts until the scheme matured.
Bank of Ireland today said it had decided to reconsider its decision and accepted that the sequence of letters it sent its customers were not clear.
As a result the bank will now rewrite to the 28,000 customers affected confirming that the original 4% fixed interest rate will now be applied, until maturity, to all top-up investment commitments made prior to 21 March this year.
However, any new top-up commitments entered into by Bank of Ireland SSIA investors after that date will attract a fixed interest rate of 1.75%.
