Today Ivan Yates spoke to Karl Deeter about the PTsb rate increase. There were several points to consider surrounding this and Ivan touched on perhaps the most important which is about credit provision in general.
Permanent TSB Rate Hike, as seen on the RTE 6 & 9 O’Clock News, 23rd July 2010
Youtube version of the clip available here
PTsb increase rates for the third time in a year
15:48 At 16:00 the press release about PTsb increasing rates will be released.
Had the company waited another week the headline ‘third time in a year’ would not have applied. It was this day last year that PTsb first increased rates on their variable clients by 0.5% or 50 basis points, it was a ground-breaking decision at the time, they were the first institution to do this and it opened the floodgates for every other bank to follow suit. PTsb were not in NAMA and they made their case, but it was rapidly criticised (in particular by Gerry Ryan who very decently gave the affected consumers a platform on his show).
The average mortgage balance in Ireland is €230,000 this time last year when the applicable rate was 2.69% the repayments would have been €1,053 per month on a 25 year mortgage. In the three rate hikes (totalling 1.5%, bringing the standard variable to 4.19%) the repayments will rise to €1,238 which will mean a total of €185 per month or €2,220 per year of …