AIB Pay Staff Green Fees Despite Mortgage Hike

It has emerged the Anglo Irish Bank is to raise its variable mortgage rate despite offering to pay employees’ golf club fees and leisure club memberships worth millions of euro per year.

In recent months, the bank has faced near closure, an ongoing Gardaí investigation, and required an immense taxpayer subsidy. However, this morning it has emerged the crisis-ridden bank is offering the staff perks scheme on the same day as raising interest rates for hard-pressed mortgage holders by half a percent – and just days after it announced record losses of €2 billion for the first half of the year.

The interest rate hike will affect approximately 50,000 customers who hold standard variable mortgages.

Speaking in response to the news of the rate hike this morning, Fine Gael Housing Spokesperson, Terence Flanagan said the banks should focus on their own cost bases rather than continually hitting hard-pressed homeowners.

Fine Gael's Deputy Flanagan was commenting on the AIB decision to increase its variable mortgage rate by 0.5%.

“The variable rate increase of 0.5% which AIB has announced is unacceptable when you consider it is taxpayers who have been asked to put their necks on the line to save the banks.

“While the European Central Bank rates remain unchanged, the banks have chosen to rip off variable mortgage holders to pay for their own reckless behaviour. Home owners are at the pin of their collar trying to make mortgage repayments. Thirty thousand are in arrears. These variable rate increases will exacerbate the problem."

Responding to criticism over their staff benefits, a spokesman for AIB said: "Staff are entitled to claim reimbursement of one sports and social club subscription for single membership in any one year. The amounts vary from half to full reimbursement of the fee with an upper limit of €2,500.

Staff members must pay full tax on all of these payments and this is deducted through the bank’s payroll system."


Related Irish News Stories
Click here for the latest headlines.

14 October 2011
'Stop Raising Mortgage Rates' Says Elderfield
Banks have been asked to stop raising standard variable rates on mortgages in a bid to relieve the problem of mortgage arrears.
24 March 2015
FF Call On Central Bank To Directly Engage With Mortgage Providers
The Central Bank has been urged to engage directly with mortgage providers in an effort to secure a reduction in the standard variable rate. Making the call Fianna Fáil finance spokesperson Michael McGrath said that "it is clear that there is a wide and growing disparity with existing customers on SVRs very much at the bottom of the pile.
09 October 2008
Bank Of Ireland Agrees To Pass On Savings
The Bank of Ireland has confirmed it will pass on its savings from Wednesday's interest rate cut to its mortgage customers. The cuts will apply to standard variable rate and tracker rate mortgage customers. The new standard variable rate will be effective from Monday, November 3.
01 June 2015
BoI Slammed For Keeping Standard Variable Rate At 4.5%
The Bank of Ireland (BoI) is being slammed for keeping its standard variable rate at 4.5%. The bank reduced its fixed mortgage rate, however it is refusing to cut its "ridiculous" variable rate and is instead effectively trying to force existing customers to lock in to a two year fixed rate, according to Fianna Fail.
12 May 2015
Fianna Fáil 'Dismayed' At Central Bank Position
Fianna Fáil has said that it is "dismayed" at reports that the Central Bank is "siding with the banks and not 300,000 mortgage holders paying variable mortgage rates which are double the euro zone average".