BAILED-out AIB is to hike its mortgage costs for customers on variable rates from September.
Its move was followed within hours yesterday by Bank of Ireland and its subsidiary ICS, both of which are increasing mortgage rates for new borrowers.
The AIB move to raise its variable rate for new and existing borrowers will mean additional payments of €60 a month for a homeowner with a €200,000 mortgage.
Around 70,000 will be affected by the rise of 0.5pc. Owner-occupiers will see their standard variable mortgage increase from 3pc to 3.5pc.
This comes despite the European Central Bank cutting its key lending rate to banks at the beginning of this month.
Every 0.25pc rate increase pushes up the monthly cost of repaying each €100,000 borrowed by about €15.
This means that a family with a €300,000 mortgage faces monthly increases of €90 from September 3. Over a full year this will cost an extra €1,080