HIGH mortgage interest rates and a bum deal for savers have allowed AIB to make “exceptionally high” profits of €2.8billion, a TD says.
Bank bosses today posted the record pre-tax profit haul for 2024, which is up 13 per cent on the previous year.
AIB Chief Executive Officer Colin Hunt lauded what he called “a very strong performance in 2024”, with a profit after tax of €2.35 billion plus a total payout to its shareholders of €2.6 billion.
But Sinn Fein’s Finance spokesperson Pearse Doherty insisted the bumper bank profits were nothing to celebrate.
Instead Doherty branded the windfall profits “unjustified”, saying they were as a result of increasing interest rates on mortgages while short-changing savers.
In a blistering tirade, the Donegal TD accused AIB of causing “real hardship” for many households across the country.
Doherty raged: “These bumper profits seen across the banking sector come at a time when interest rates on mortgages continue to put homeowners under real pressure.
“These profits are not the result of savvy business decisions, increased productivity or innovation. They are a result of the interest rate environment and the money homeowners have been forced to pay in higher interest rates while savers are short-changed.
“Banks have been very quick to pass on higher interest rates from the ECB despite Ireland already having some of the highest interest rates in the EU. At the same time, they have been slow to increase interest on savings.
“Ireland continues to have some of the highest interest rates in the EU and interest rates on savings are below the EU average.
“This has led to the direct transfer of wealth from households to corporate profits of the banks.
“Banks and a number of other privileged sectors such as insurance and electricity have been allowed to make unjustified windfall profits that have caused real hardship for many.
‘GOVERNMENT FAILING TO ACT’
“High bank profits during a cost-of-living crisis is not the sign of a healthy economy but a government failing to act.”
Irish mortgage rates remain well above the Euro area average.
That is despite the average rate on new mortgages falling to 3.8 per cent in December, down from 3.97 per cent in the previous month.
It marked the lowest level since April 2023 and the largest monthly fall in Irish mortgage rates since 2017.
RATES ABOVE EURO AVERAGE
The easing of rates follows a series of recent successive rate cuts by the European Central Bank.
But despite the decrease, Irish mortgage rates were notably above the Euro area average, which fell by eight basis points in December to 3.35 per cent.
Ireland is the 7th highest out of the 20-country Euro area.
