Banks increase profit from mortgages as ECB rates rise
A new survey has revealed that two of the country's main banks have increased their profit margins from fixed-rate mortgage holders while the European Central Bank has raised interest rates.
A survey by the Sunday Business Post has found that AIB and National Irish Bank have significantly increased their margins in the last year, during which the European Central Bank has increased interest rates four times.
Fixed rate mortgages should not be affected by the interest rate increases as banks fund these loans from an inter-bank market.
The Sunday Business Post has claimed AIB more than doubled its lending margins on three- and five-year mortgages, while National Irish Bank has increased its margins on fixed-rate lending.
A spokesperson for AIB argued that the bank is competitive within the market and that the bank's margin on fixed loans is constantly changing.
National Irish Bank said the rise in profits and the rise in ECB rates was coincidental.
Six institutions were surveyed during the course of the study, but only AIB and NIB were found to have significantly increased their fixed rate margins.
