DUBLIN: KBC Bank Ireland is reducing interest rates on a number of its savings accounts. For personal customers, three accounts will be affected. The ‘smart access demand account’ will see the annual equivalent rate (AER) reduce from 0.45 per cent to 0.30 per cent. That account is primarily for customers with savings between €3,000 and €100,000. A similar account with AIB, the ‘online fixed term deposit’ account currently achieves an AER of 0.30 per cent. The ‘regular saver account’, for customers saving between €100 and €1,000 per month, will see the AER reduce from 1 per cent to 0.50 per cent.
A Bank of Ireland account for regular savers with a slightly higher maximum yearly allowance of €14,999 achieves a variable AER of 1.35 per cent. AIB’s ‘online saver’ account and ‘saver account’, which allow customers save up to €1,000 per month, both achieve an AER of 1.50 per cent. The ‘select access demand account’ for sterling customers will see its AER reduced from 0.15 per cent to 0.10 per cent. Business and pension customers using the ‘smart access demand account’ will note their AER reducing from 0.15 per cent to 0.10 per cent. AER is the easiest way for banks to compare their savings account offerings. It shows what the interest rate would be if the interest was compounded and paid each year.