Mortgage holders to be hit with repayment increases

Mortgage holders to be hit with repayment increases as Ulster Bank raises rates → … 6-May2011/

I wonder if Ulster Bank is in trouble.

Today I saw that they are offering 3.7% gross on a one-year savings account, with the interest to be applied at the end of the year. No withdrawals. This is a very high interest rate in the current climate and they were offering 3.5% before that.

They also announced quite some losses for the first term of this year.

Wow, that’s not far off the rate a mate fixed at at the peak of the last interest rate cycle - about 4 years ago @ 5.54% for 5 years

Considering the ECB rate and the fact that RBS is backstopped by HM Treasury I’d go as far as to call it gouging and if someone were to say “f*** it I’m throwing good money after bad at this level” I wouldn’t judge him for it

Unfortunately, they have two problems:

  1. They have to fund in euro
  2. They are in Ireland…

And now those who bought at the top are paying for their own mistakes and those of others

Competition in the deposit market has heated up a lot in the past year. EBS, BOI, AIB and Ulster have been trumping each other on AER with each new term deposit release. It’s now seen as a better alternative to borrowing from the markets even with such a negative margin. You’ll see in UB’s most recent results they have managed to grow their deposit book at the expense of BOI and AIB.