| 12°C Dublin

Firms hit as BoI hikes loan rate

ALMOST one in five business customers of Bank of Ireland are facing higher repayments from next month.

In a major departure, the bank has unilaterally changed how it sets interest on the loans.

The new calculation is based on its own costs of raising money through customer deposits, the money markets and other funding sources and the interest rate now rises to 4.79pc from 4.09pc.

A customer who has taken a €300,000 loan on a term of seven years will pay €4,210 a month compared with €4,113 a month previously. The change, which comes into effect from November 16 for loans of more than €300,000, means that businesses face an increase of about 0.7pc a year on term loans.