Bank of Ireland has increased fixed rates for new mortgages by 0.25 percentage points following the European Central Bank's decision to raise interest rates for a third time this year, by 0.75 points.

The rate hike, effective immediately, applies to customers drawing down new mortgages from the bank, but customers who already have a written quote from the lender for a lower fixed rate can avail of the lower rate if they draw their mortgage down by 9 December.

Bank of Ireland's variable and tracker rates are not affected by the change, and there is no change to the rates available for existing mortgage customers.

Existing fixed-rate mortgage customers coming to the end of their term and existing variable or tracker customers can still avail of unchanged fixed rates.

"In light of recent interest rate increases by the ECB, Bank of Ireland is today announcing an increase to new fixed-rate mortgages of 0.25%," said Alan Hartley, director of home buying at Bank of Ireland.

In Association with

"This increase applies only to new mortgages. Customers with existing mortgages with Bank of Ireland and who are considering re-fixing can still avail of unchanged fixed rates.”

Bank of Ireland said it would keep interest rates under review and clearly communicate any potential future changes. AIB raised fixed rates by 0.5 points last month, becoming the first of the main banks to raise rates following the ECB decision.

Interest rates on new mortgages fell 0.06 points to an average of 2.58%, and 0.03 points to 2.46% on fixed-rate mortgages in September, according to the Central Bank