AIB announce 0.5% interest rate increase

Just ahead of being nationalised.

Karl Deeter on Newstalk just said AIB to increase Variable Mortgages by 0.5%

Hee!

Lands the government in the crapper when they are announcing how much they are going to have to hand over to AIB tomorrow and at the same time they announce interest rate increases across the board.

I think it is an attempt not to - a sudden bowel loosening “oh shit, we were going to say that was a commercial decision for a private bank, we can’t find a way to keep them majority private so it’s going to look awful, quick shove it out now”

What a bunch of monkeys. They’re all eating bananas now.

So we take on massive national debt (pretend, pretend it’s not via a SPV), we also take a majority equity share in them and then they still need to raise their interest rates irrespective of the ECB base rate.

Why are we saving these failed institutions again?

So now we are approx, 2.5% over 3 month Euribor.
That puts the standard variable rate at 5% in 2.5 years, assuming the markets expectation of interest rate rises in Europe over that period is correct

60% of their mortgage book is trackers?

I would have thought it helps FF. How could FF have taken over and then had AIB say we are raising rates. This is like Gormley’s incinerator. “It was signed off before I came, I can do nathin”.

Where did you get that number? What % are fixed and variable also?

rise away - at least it might push up profits and make it esier for the Government to sell back to the private markets in the near future.
Over the years, state bodies were refused price increases for political reasons rather than economic reasons, it was the taxpayer that lost out in the end.
No point in recapitalising a bank that will remain loss making - I can sleep easier at night knowing that if I’m recapitalising a bank, at least it is moving towards profitability.

I wonder will we get “shocked” mortgage holders on Joe Duffy. I may take the month before people see the effects. It was always on the cards to all here but a lot of people who are already strapped had no idea it was coming.

Is that distant roaring noise I hear the sound of an oncoming wave of mortgage defaults?
It seem to have suddenly got a bit closer…

The banks are so screwed at this point that there is literally nothing they can do
to solve their problems without causing massive collateral damage… to themselves. There seems to me to be only one exception; getting a load of cash from the taxpayer.

irishtimes.com/newspaper/bre … ing38.html

Be interesting to see how much in gross terms of mortgages this refers to. Then we could work out how deflationary it is…

They just seem determined to bring the state down with them.

Is that correct?

Yeah I thought the same, surely they meant depositors not investors :nin
Just goes to show you, a deposit account with AIB these days carries a lot more risk that yesteryear! XX
may we live in interesting times…

Investment mortgages rather than residential.
It would have to be new fixed rates too, I don’t see that they could change any existing fixed rate as, eh, it wouldn’t be fixed…
Not sure that AIB are offerring any new trackers, so that may explain the lack of change there “We haven’t changed our trackers!” “You feckin’ don’t have any you bastards!” “Ah, but they haven’t gone up!”

Is this a bureaucratic move that allows them to ‘show’ they need less funding than previously supposed?
Their projected income stream would be strengthened and therefore they dont need to be taken over by the state.