# ECB cuts interest rate to 1.25%



## TheJackal (3 Nov 2011)

As above

[broken link removed]


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## DB74 (3 Nov 2011)

I wonder how many will pass it on


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## sunnywalk (3 Nov 2011)

happy days


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## Sunny (3 Nov 2011)

Gotta love Italian Central Bankers.....


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## bluemac (3 Nov 2011)

a bit more good news... it keeps coming in..


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## Guns N Roses (3 Nov 2011)

YES! Just in time for Christmas! 

It seems the longer the crisis in Europe goes on, the better for us.


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## STEINER (3 Nov 2011)

as I am on a tracker mortgage, any ECB rate cut is great.  However, all the market uncertainty is no doubt eroding my pension fund, I am dreading the January statement.


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## aristotle (3 Nov 2011)

Yeah nice! Of course its a reflection of a very weak economy so its not all good news overall.


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## bluemac (3 Nov 2011)

higher growth than expected in the UK early this week one of our major export markets..


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## PaddyW (3 Nov 2011)

That'll do nicely!


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## NorfBank (3 Nov 2011)

DB74 said:


> I wonder how many will pass it on



Permanent tsb bank has confirmed that it will pass on the reduction in full to customers on both Variable and Tracker Rate mortgages.  The cut in rates will be effective from 21st  November.  The new SVR rate for permanent tsb bank – after this cut is introduced – will be 5.44%.

www.moneybackmortgages.ie


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## TheJackal (4 Nov 2011)

KBC Bank are also passing on the cut on variable mortgage holders but Ulster Bank have said they will not.

No news from BOI or AIB yet.


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## Pope John 11 (4 Nov 2011)

http://www.thejournal.ie/two-banks-...-rate-cut-to-mortgage-holders-271144-Nov2011/

KBC Bank say they will also pass on the interest rate cut


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## NorfBank (4 Nov 2011)

AIB not passing on cut as it hasn't increased it's variable rate since August 2010.
BOI not passing it on either.


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## Leaky1 (7 Nov 2011)

still no comment from EBS regarding passing it onto it's variable rate customers?
Should I take it to mean that they're not gonna do it?


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## NorfBank (7 Nov 2011)

Leaky1 said:


> still no comment from EBS regarding passing it onto it's variable rate customers?
> Should I take it to mean that they're not gonna do it?



That would be a pretty safe bet.


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## Leaky1 (7 Nov 2011)

so frustrating, they had no problem raising the variable rate when the ECB went up. And just raising it randomly too of course.

Would've been nice if they could have confirmed officially that they weren't passing it on.


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## monore (7 Nov 2011)

EBS has raised variable rates three times since the election despite promises by Gilmore that the state owned banks would not do so. 0.6% the week after the election and two further rises since. I assume the govt will now ignore Elderfields warning that these rises are leading to a rise in arrears and they will not pass on ECB cut in EBS.


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## marksa (7 Nov 2011)

i was biting my tongue as to whether to respond here given the wall of expectation, that just because cut its rates, the banks would cut variable rates. banks only take a portion of their funding from ECB - approx 60/70% I believe in Ireland. The remaining 30/40% has to come from ultra expensive deposits, term funding, capital etc. 

The lack of even a basic understanding of the funding base of Irish banking is apparent here, and it would be great if someone would create a sticky post on the subject which could then be appended to any and all disccussions that arise every time ECB changes its rates, or banks changed their rates.

And before anyone jumps down my throat for showing a dissenting view - I am not on a tracker, and am on fixed, reverting to variable with NIB where the rates just went up 0.95%.


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## Watcher (8 Nov 2011)

Fact remains that there is a huge variation in the SVR offered by the lenders who are effectively only in existence due to the inpetus of cash by johnny tax payer. 

Ultimately the lenders are losing money based on their massive misprojections and miscalculations as to their exposures.

Bottom line is that they screwed up with their tracker offerings, will SVR customers forever be expected to fund this?

Perhaps..

But if thats the case and the lenders dont pass on reductions in the real lending rates, then there will be an increase in default / inability to pay.

Either way the tax payer will fund this, but its the manner in which the payment is extracted which is key.

The banks need to make money innovatively by banking. Not passing on reductions wont work...Not sustainable and ethically not viable.

PTSB and KBS are passing on rates (although may be late in the game for PTSB to try and get a PR coup as they are far and away the highert SVR in the country...6.15 down to 5.9%.....doesnt really rate well


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## monore (8 Nov 2011)

This hasn't really got anything to do with funding. More that the interest rate rises in EBS far above the ECB rises break pre election promises and contradict the govt reassurance that they are concerned about struggling mortgage holders. Instead they have steadily increased the burden on variable rate mortgage holders.


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## falabo (8 Nov 2011)

NorfBank said:


> Permanent tsb bank has confirmed that it will pass on the reduction in full to customers on both Variable and Tracker Rate mortgages.
> [broken link removed]


 

LOL  they have no choice but to pass it on to those with tracker mortgages, why do they even mention it ? LOL


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## NorfBank (8 Nov 2011)

NorfBank said:


> That would be a pretty safe bet.


 


The EBS is to reduce its standard variable interest rate by 0.25% from 4.93% to 4.68%, the bank announced today. 
In other news National Irish Bank are to increase theirs by 1%.


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## PaddyW (8 Nov 2011)

falabo said:


> LOL they have no choice but to pass it on to those with tracker mortgages, why do they even mention it ? LOL


 
I've always wondered that too, it's not like they have any other option but to pass it on.


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## demoivre (8 Nov 2011)

NorfBank said:


> In other news National Irish Bank are to increase theirs by 1%.



It will be interesting to see how things develop with this announcement as  Enda Kenny has  indicated he was prepared to consider  introducing legislation to compel banks to adjust their rates  accordingly.  Michael Noonan also said last week  banks must pass on the interest rate reduction to customers.


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## Brendan Burgess (8 Nov 2011)

I have posted a table of the SVRs here.

AIB seems to be charging less on its mortgages than it is paying for some of its deposits. This makes no sense. 

Although PTSB has passed on this rate cut and NIB has increased its rates by 1%, PTSB is still 1.5% dearer.

I just can't see that the government or the Central Bank has any role in telling banks to pass on rate cuts. 

Brendan


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## 44brendan (8 Nov 2011)

Brendan Burgess said:


> I have posted a table of the SVRs here. I just can't see that the government or the Central Bank has any role in telling banks to pass on rate cuts.


 
I agree that in respect of Banks/institutions that have not availed of Gov support this type of action could be viewed as interference in the market. However where institutions have been given Gov support I would think that the Gov are entitled to exert some leverage in this & other areas.
To some extent it may be seen as unwarranted but dependency on public support whilst at the same time charging heavy margins on a sector of the same public could be seen as somewhat conflicting.


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## adox (18 Nov 2011)

Anybody heard from Halifax/BOS yet in relation to the latest cut?
I have one of their price promise mortgages where the rate they charge will never be more than 1.5% above the ECB rate, so its due to come down in line with the last cut. Havent received any correspondance from them yet.


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## bluemac (1 Dec 2011)

Just checked my account my Ulster bank Tracker mortgage was taken out yesterday November the 30th the amount was the same as usual so no cut has been made in my tracker?   any one else expected there to be changed by now?


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## DB74 (1 Dec 2011)

I haven't received any correspondence from PTSB to say that the repayment will be changing, which I was expecting to have received at this stage. Mortgage comes out next week so will update then.


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## Sunny (1 Dec 2011)

bluemac said:


> Just checked my account my Ulster bank Tracker mortgage was taken out yesterday November the 30th the amount was the same as usual so no cut has been made in my tracker? any one else expected there to be changed by now?


 
My Ulster Bank tracker changed but it wasn't until late November so the change in the mortgage payment was minimal.


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## bluemac (1 Dec 2011)

mine didn't change by a penny, in the old days you would have trusted the banks..


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## Fiskar (1 Dec 2011)

Relax, Got my letter today from PTSB for the main house, reduced to 2.6% from 2.85%. Only a small mortgage on this house, the BTL will be poking 6.9/6.7 % when it comes off fixed. Think it will be time to move that mortgage.


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## Armada (2 Dec 2011)

My BOI trackers changed today too.. got a letter from them about 10 days or so confirming cut.


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## suemoo1 (2 Dec 2011)

Sunny said:


> My Ulster Bank tracker changed but it wasn't until late November so the change in the mortgage payment was minimal.




Im with Ulster Bank tracker also.. still havent received the cut.. my last mortgage payment came out of bank 27th November but still the same amount and no correspondence from them either.. must phone and see whats happening, did you get a letter Sunny?


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## Sunny (2 Dec 2011)

suemoo1 said:


> Im with Ulster Bank tracker also.. still havent received the cut.. my last mortgage payment came out of bank 27th November but still the same amount and no correspondence from them either.. must phone and see whats happening, did you get a letter Sunny?


 
Got one earlier this week. Can't remember the date that they said the cut was effective from though. I will check this evening.


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## STEINER (2 Dec 2011)

I have not got an interest rate change letter yet from PTSB either and my monthly payment is 5th of each month. When rates increase PTSB always increase the monthly repayment asap. I wouldn't mind waiting a month if they were consistent and took the same time with applying increases and decreases.


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## suemoo1 (2 Dec 2011)

Thanks Sunny..


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## adox (5 Dec 2011)

adox said:


> Anybody heard from Halifax/BOS yet in relation to the latest cut?
> I have one of their price promise mortgages where the rate they charge will never be more than 1.5% above the ECB rate, so its due to come down in line with the last cut. Havent received any correspondance from them yet.



Just an update. Still no letter received from bos. Rang a number in Scotland today to enquire what was going on? (call centre). The guy told me a letter was posted to me on the 30th November to inform me of rate reduction. As yet I haven't received it. 

Mortgage was takenout today and there was no reduction. Its due on the 3rd of every month, but bing a Saturday this month,only left my account today. 

Now by my reckoning, the ECB announced their rate cut and so BOS probably had 30 days maximum to pass it on, which would bring it up to November 3rd!

Hopefully the letter will arrive at some stage this week so I csn see what exactly it has to say.


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## rameire (6 Dec 2011)

you mean dec 9th.
it was announced on the 3rd but was not effective until the 9th
thus 30 days from the 9th is the 9th


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## adox (6 Dec 2011)

rameire said:


> you mean dec 9th.
> it was announced on the 3rd but was not effective until the 9th
> thus 30 days from the 9th is the 9th


 

Ah my mistake. thanks for clarifying.


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## suemoo1 (6 Dec 2011)

Sunny said:


> Got one earlier this week. Can't remember the date that they said the cut was effective from though. I will check this evening.



Sunny, I got my letter yesterday 6th Dec.. cut comes into effect on my next payment on 27th Dec. thanks


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## RMCF (6 Dec 2011)

When will the next 0.25% be cut by the ECB?


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## callybags (6 Dec 2011)

I heard this morning that they are considering a .5% cut in the next week or two.

We wait in hope.


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## NorfBank (6 Dec 2011)

RMCF said:


> When will the next 0.25% be cut by the ECB?



Thursday, either 0.25% with another 0.25% in the new year or they may put down a marker and cut by 0.5% on Thursday according to "experts".


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## loli (8 Dec 2011)

Can someone knowledgable explain to me the logic behind the banks decision when to pass on the cuts/increases in interest rates? I have a mortgage with KBC and when there was an increase in July, the ECB announced the increase on the 7th and the bank increased the rate from the 14th, so within 7 days I was paying the new interest rate. However when they cut it in November, the announced it on the 3rd and the bank didn't implement it until 1st December. My repayment comes out every 1st and there was no change in the December repayment. When I rang them they said the mortgage is paid always for the previous month and that the lower repayment wouldn't be until 1st January. So when it increased, I was paying the high rate within 7 days, but when it goes down I still pay the higher rate for another 2 months???


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