AIB has today announced cuts to both its deposit rates and its mortgage interest rates in response to the recent rate cuts from the European Central Bank.
The bank said the interest on its one and two year Fixed Term Deposit accounts will reduce by 0.25% and 0.5% respectively - effective from May 13.
AIB said all its other savings and deposit rates remain unchanged. This is its second cut to deposit rates after it made its first cut in January of this year.
AIB also said today it would reduce its fixed rate mortgages by up to 0.75% for new and existing AIB, EBS and Haven customers.
Its two year fixed rate for mortgages will reduce by 0.75% and all other fixed rate mortgages will reduce by 0.50%, excluding its High Value four year fixed rate.
AIB said these "significant reductions" could benefit a large number of customers, adding that they will take effect from May 13.
The lender said the reductions are in line with the falling interest rate environment and its commitment to delivering value for customers, particularly for those whose homes do not have a Building Energy Rating of B3 or higher.
"The reductions will also help customers coming to the end of their fixed term, as they roll off historically lower rates into an environment where rates are now higher," it added.
A monthly repayment on a new €300,000 AIB 2-year fixed rate mortgage, with a loan to value of 50-80% over a 25 year term will be €1,557.37.
The previous monthly repayment would have been €1,682.35, representing a saving of €124.98 a month, €1499.76 a year, or €5,177.47 over the 25 year term.
The latest reductions follow a number of cuts to green mortgage rates by AIB last year.
AIB's Managing Director, Retail Banking, Geraldine Casey, said the bank takes a balanced and measured approach to interest rate changes.
Ms Casey said that AIB understands that some customers are buying a home in areas where green properties are limited and also that some customers are coming to the end of a previous fixed rate mortgage, taken out at a time where the interest rate environment was much lower than it is now.
"These reductions, coupled with previously announced reductions to our green rate mortgages and our competitive variable rates demonstrate our commitment to supporting customers and providing them with the best value on their home buying journey," she said.
"In line with the falling interest rate environment, we are reducing two of our Fixed Term Deposit accounts while keeping all other savings accounts unchanged. AIB continues to offer some of the most competitive savings rates in the Irish market, especially for customers who require instant access on their savings," she added.
