I'll be controversial here.
Given that PTSB
1) have an outrageously low deposits to loans ratio
2) need to offer interest rates of 4%+ to attract depositors
3) are likely to face arrears in up to 15% of its existing book of mortgages
are they the only ones with any sense in terms of setting a mortgage rate in or around the 5% mark for customers it built up largely from 2002-2008?
Given the increased strictness of underwriting standards for new business nowadays, I'd expect the interest rate on the existing book of business for any bank to be 1% to 2% higher than the rates being offered to the safer new customers.
Think of it. If someone offered to sell you the collateralised repayments of the 2002-2008 book versus the 2009-2012 book do you not think you'd apply a significantly higher haircut to the 2002-2008 business?
Also, if a PTSB mortgage holder really considers themselves to be zero risk, as measured by savings, good LTV and a solid income, shouldn't they be in a position to remortgage at rates closer to 3% in the short to medium term?
Finally, we talk about competition, complain about cartels and price fixing, and then expect all banks to operate their loan rates withing a narrow range?
I think the new CEO is mad to be going on his current crusade of apologising for SVR rates.
Given that PTSB
1) have an outrageously low deposits to loans ratio
2) need to offer interest rates of 4%+ to attract depositors
3) are likely to face arrears in up to 15% of its existing book of mortgages
are they the only ones with any sense in terms of setting a mortgage rate in or around the 5% mark for customers it built up largely from 2002-2008?
Given the increased strictness of underwriting standards for new business nowadays, I'd expect the interest rate on the existing book of business for any bank to be 1% to 2% higher than the rates being offered to the safer new customers.
Think of it. If someone offered to sell you the collateralised repayments of the 2002-2008 book versus the 2009-2012 book do you not think you'd apply a significantly higher haircut to the 2002-2008 business?
Also, if a PTSB mortgage holder really considers themselves to be zero risk, as measured by savings, good LTV and a solid income, shouldn't they be in a position to remortgage at rates closer to 3% in the short to medium term?
Finally, we talk about competition, complain about cartels and price fixing, and then expect all banks to operate their loan rates withing a narrow range?
I think the new CEO is mad to be going on his current crusade of apologising for SVR rates.