Loan refusal statistics: what do they mean?

There are two sets of statistics floating around; on one hand you have the banks who claim that they are lending and also that the demand for credit simply isn’t there – a belief further expounded by John Trethowan. Then on the other hand you have the likes of PIBA who counter claim that 80% of applications are being refused.

So it is important to break down the vital components. First of all, the debate often centres around Small Medium Enterprise (SME) lending; even if demand for that type of credit isn’t there it doesn’t automatically translate into a reduced demand for mortgages. The point being that we can’t compare SME loans/business loan demand to that for mortgage credit.

Secondly is ‘what constitutes a refusal’, and this is where common sense diverges. Even the bank accept that if you seek €200,000 and are only offered €100,000 that it is a loan not fit for purpose, this even goes …

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Best Deposit Rates: June 2011

If you would like any advice on deposits (apart from rates which we provide below) then you can call us on 016790990. There may be other issues such as wanting to deal with non-Irish banks, or only banks that are covered by the Irish guarantee, we can guide you through.

Best Demand Account: Nationwide UK (Ireland), ‘Easy Access’ 3%

Best 6 month fixed: KBC Fixed Term 1.75% (CAR 3.58%)

Best 1yr fixed: PTsb ‘Interest First’ 3.71%

Best 18mth fixed: EBS Broker 6.5% (CAR 4.29%)

There are other deposit options with longer terms, and also with different choices or durations than our ‘quick list’; but we wanted to cover the most popular ones primarily so if you have further queries then you know what to do!

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Best Deposit rates in Ireland March 2011

The best deposit rates presently available in Ireland are as follows:

Best Demand Account:     Ulsterbank Special Interest Deposit 4%* Best 1 month deposit:      NIB eSaver 3% Best 3 month deposit:      PTsb 3mth Fixed 2.5% Best 6 month deposit:      PTsb Interest First 3.25% Best 12 month deposit:    Nationwide UK (Irl) 3.65%

We can find the best options for you on other terms or go through the various deposit choices available if you want help navigating the market call us on 01 679 0990

*To a maximum of €15,000

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Irish banks, caught in the perfect funding storm

Irish banks are caught in a perfect storm of funding costs versus lending costs which spells bad value for consumers. This is clearly seen on the deposit and lending fronts, our banks can’t offer headline rates on deposits, nor can they charge sufficiently on lending. This is creating a multi-billion Euro dilemma which will ultimately be paid for by an already unfairly burdened taxpayer.

On the deposit side foreign banks can afford to pay far more than Irish institutions meaning they can hoover up deposits rapidly and with relative ease, on the lending side, Irish banks are unable to obtain the margin they need in order to compete and remain profitable.

When it comes to leading rates for indigenous lenders you will see that Anglo, despite being nationalised and having the inherent backing of the state on all deposits, is paying the highest rates for an Irish institution on  6 month (it is the best of the Irish institutions) and 1yr deposits (it is the best across the board on 1yr deposits) – this is well above the odds they …

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Best deposit rates in the Irish market April 2009

Here is a list of the deposit products in Ireland with the highest interest rates at present.

Demand account: Anglo premium demand 4.75% 7 day notice: Anglo 2% 21 day notice: PTsb 21 day saver 4% 1 month: Investec 3.25% 75 days: PTsb 3.6% 6 month: Investec 4.25% 1 year: Anglo 4.9% 18 month: EBS 6%

If you want to consider your deposit options you can contact us on 01 6790990, although we don’t have deposit agencies with every lender listed in the top position, so in some cases we’ll have to send you direct but in any case we can still help you choose the best deal on the market. All rates are up to date as of 20th of April 09′ and are subject to change.

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How falling interest rates hurt banks during a liquidity crisis

The falling interest rates are heralded by consumers of Irish mortgage companies as a godsend – well, for the clients of the Irish banks who actually pass on the full rate cuts that is! However, at the same time it creates a rate compression which damages the bank and this is what we will consider in this article.

Banks have two sides to the operation roughly speaking, on one side there is the lending function which we are all aware of, mortgages, car loans, personal loans etc. on the other side is the deposit taking function which provides part of the money they lend out. There is of course the interbank market which supplements (and often surpasses) deposit funds for lending, but to keep things simple we will focus on a world where deposits roughly equal lending.


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What next lenders?

Here are some ideas about where we feel banks will go next in terms of the lending market, these are only opinions, whether or not we see any of this coming to fruition can only be told by time.

1. Early Redemption Bonus: Early redemption means ‘paying off your mortgage early’, in fact when you switch your loan this is what happens, or when you clear it entirely. Why would a bank offer you a cash bonus for actually moving your loan away from them though? Or for paying it off? Isn’t the idea that you pay lots of interest?

Actually that’s a mixed answer, normally it would be ‘yes’, banks want you to keep paying interest over time, but now we are seeing a few things that we have not seen before. Firstly are negative margin loans, if you have a tracker of anything less than ECB + 1.5% (ish) then the likelihood is that the bank is not making any money on your loan after their operational cost, therefore it may be worthwhile to give you a monetary …

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