KBC Bank Ireland announced its market exit in 2021 and completed the transfer of most residential mortgages to Bank of Ireland in 2023. If you’re a former KBC customer, understanding what this transfer means for your mortgage—and what options you now have—can save you thousands of euros over the remaining term.
This guide explains exactly what happened during the transfer, how it affects your mortgage payments and terms, and whether switching to a different lender makes financial sense in 2026.
What Happened to KBC Mortgages in Ireland
KBC Bank Ireland ceased providing banking services in Ireland as part of a strategic decision by its Belgian parent company. In July 2022, Bank of Ireland agreed to acquire approximately €9 billion worth of KBC performing residential mortgages—the vast majority of KBC’s home loan book.
The transfer completed in phases throughout 2023. Former KBC customers received multiple communications confirming transfer dates, new account numbers, and contact details for Bank of Ireland mortgage services.
A small portion of KBC mortgages—primarily those in arrears or restructured accounts—transferred to Pepper Finance Corporation (Ireland) DAC, a non-bank lender specializing in distressed loans.
How the Transfer Affects Your Mortgage Terms
Bank of Ireland committed to honouring all existing terms and conditions from your original KBC mortgage agreement. This means:
Your rate type stays the same. If you were on a KBC fixed rate, you continue that fixed period at the same rate until expiry. Variable rate customers transferred to equivalent Bank of Ireland variable products.
Your interest rate initially remains unchanged. The percentage you paid KBC is what you started paying Bank of Ireland—at least for the first payment cycle after transfer.
Your repayment amount and schedule continue. Monthly payment dates, term length, and remaining balance all transferred exactly as they stood.
Existing offset arrangements ended. KBC offered current account offset mortgages where your savings reduced the interest charged. Bank of Ireland doesn’t offer this product, so those benefits ceased at transfer. Former offset customers moved to standard variable or fixed products.
The Rate Problem: Why Former KBC Customers Pay More
Here’s the issue that affects most transferred customers: while Bank of Ireland maintained your original rate initially, those rates are typically 0.5% to 1% higher than Bank of Ireland offers to new customers or switchers in 2026.
This gap exists because KBC’s pricing in their final years was uncompetitive. The bank stopped aggressively competing for new business from 2021 onwards and existing customers saw rates drift above market levels.
Bank of Ireland has not automatically moved transferred accounts to their current best rates. A former KBC customer on a 3.5% variable rate remains at 3.5%, even though Bank of Ireland offers 2.8% to new switchers with identical loan-to-value ratios.
Rate Comparison: Transferred vs New BOI Customers
| Loan-to-Value | Typical Transferred KBC Rate | Bank of Ireland Switcher Rate 2026 | Monthly Difference (€250k mortgage, 25 years) |
|---|---|---|---|
| 60% or less | 3.4% | 2.75% | €95 |
| 60-80% | 3.7% | 2.95% | €110 |
| 80-90% | 4.1% | 3.45% | €95 |
These figures are indicative. Your actual rate depends on whether you were on a KBC standard variable, fixed, or tracker product before transfer.
Your Rights as a Transferred Customer
The Central Bank’s consumer protection framework applies fully to transferred mortgages. You have the right to:
Switch lender at any time. No break fees apply to variable rate mortgages, even though the lender changed. Fixed rate mortgages incur standard break fees if you exit before the fixed period ends—same as before transfer.
Request rate reviews. Bank of Ireland must consider rate reduction requests, particularly if your loan-to-value has improved through property value increases or principal repayments.
Challenge incorrect transfers. If Bank of Ireland applied wrong terms, rates, or balances, you can formally complain and escalate to the Financial Services and Pensions Ombudsman if necessary.
Access mortgage switching incentives. Other lenders actively target former KBC customers with cashback offers and legal fee contributions. You’re not obligated to stay with Bank of Ireland simply because they acquired your loan.
Should You Switch Away from Bank of Ireland?
For most former KBC customers, switching to a different lender delivers immediate savings. The decision depends on three factors:
Rate differential. If you’re paying 3.5% and can get 2.8% elsewhere, switching makes financial sense. Use a mortgage calculator to quantify monthly savings over your remaining term.
Remaining balance and term. Switching involves legal fees (€1,000-1,500) and valuation costs (€150-250). You need sufficient remaining balance—typically €100,000 or more—and term length—ideally five years or longer—to justify these costs through interest savings.
Fixed rate status. If you’re mid-way through a fixed rate period with two or more years remaining, calculate the break fee. For many, waiting until the fixed period ends makes more sense than paying the penalty to switch now.
When Switching Makes Clear Sense
You should strongly consider switching if:
- You’re on a variable rate paying above 3%
- Your remaining mortgage balance exceeds €150,000
- You have more than seven years left on your term
- Your loan-to-value is now below 80% due to property value increases
- Another lender offers a rate 0.5% or more below your current rate
When Staying Might Be Better
Switching may not be worthwhile if:
- Your remaining balance is below €75,000
- You have fewer than four years remaining on your term
- You’re in a fixed period with a significant break fee exceeding two years of potential savings
- Your loan-to-value remains above 90% and you can’t access better rates elsewhere
The Switching Process for Former KBC Customers
Switching from Bank of Ireland works identically to switching from any other lender:
1. Get approval in principle. Apply to your chosen new lender with current income documentation, Bank of Ireland mortgage statement, and proof of property value. Most lenders respond within a week.
2. Formal application and valuation. If approved in principle, complete the full application. The new lender arranges a property valuation (you pay the fee upfront, typically €150-250).
3. Legal process. Both lenders instruct solicitors. Your solicitor handles the discharge of Bank of Ireland’s charge and registration of the new lender’s charge. This takes 4-8 weeks. Total legal costs typically run €1,000-1,500.
4. Completion. Your new lender pays off Bank of Ireland directly. You start making payments to the new lender from the completion date. Keep one month’s payment in your account for timing purposes—you may have one month where you pay both lenders (you’ll receive a refund for any overlap).
Cashback and Incentives in 2026
Several Irish lenders offer switching incentives specifically designed to attract former KBC and Ulster Bank customers (Ulster Bank also exited the market around the same time).
Permanent TSB offers 2% cashback on switching mortgages, capped at €7,500. For a €250,000 mortgage, that’s €5,000 paid into your account after completion.
AIB contributes €3,000 towards legal and valuation costs for switchers with balances above €250,000.
Avant Money offers 2% cashback uncapped, making them competitive for higher balance mortgages. Some former KBC customers with €400,000+ balances receive €8,000.
These incentives change regularly. A mortgage broker can identify the current best offer for your specific situation.
Fixed Rate Expiry: Your Key Decision Point
If you transferred from KBC on a fixed rate that expires in 2026 or early 2027, this is your natural opportunity to switch.
Bank of Ireland will write to you 90-120 days before expiry offering renewal options. Compare these carefully against other lenders’ rates. Do not automatically accept the Bank of Ireland offer—their retention rates are typically 0.3-0.5% higher than their switcher rates.
When your fixed rate expires, you move to Bank of Ireland’s standard variable rate unless you actively choose a new fixed term or switch lender. The standard variable rate is usually the most expensive option available.
Start the switching process 60-90 days before expiry. This gives you time to complete the move before rolling onto the expensive variable rate.
Former KBC Tracker Mortgages
A small number of KBC customers held tracker mortgages—loans where the rate tracks the European Central Bank base rate plus a fixed margin (e.g., ECB + 1%).
These transferred to Bank of Ireland with the tracker terms intact. You continue to benefit from rate changes tracking the ECB.
Tracker mortgages are valuable because the margin is locked. As ECB rates fell through 2024-2026, tracker customers saw automatic rate reductions. Do not switch away from a tracker unless another lender offers a rate at least 0.75% below your current tracker rate and you’ve calculated that the saving over your remaining term exceeds €20,000.
Most tracker customers should keep their existing mortgage.
Getting Help with Your Decision
If you’re unsure whether switching makes sense for your situation, speak with a mortgage broker. Most offer a free initial review where they:
- Pull your current Bank of Ireland mortgage statement
- Calculate your updated loan-to-value ratio based on current property values
- Compare your rate against current market offers
- Quantify potential savings over different timeframes
- Identify any cashback or switching incentives you qualify for
Brokers access all lenders simultaneously and handle the application process on your behalf. They’re paid by the lender you switch to, so there’s typically no upfront cost to you for their service.
Common Transfer Issues and Resolutions
Incorrect balance transferred. Some customers reported discrepancies between their final KBC statement and opening Bank of Ireland balance. Request a detailed breakdown from Bank of Ireland and compare against your KBC records. If an error exists, Bank of Ireland must correct it and refund any overpaid interest.
Direct debit problems. A small number of customers experienced failed direct debits in the first few months post-transfer. Check your bank statement after the first payment date. If the payment didn’t process, contact Bank of Ireland immediately and make a manual payment to avoid arrears markers on your credit file.
Missing KBC statements. You may need historical statements for tax purposes or remortgaging. Bank of Ireland should provide access to transferred account history. If they can’t, contact KBC’s legacy customer service line—they maintained records for these queries.
Offset mortgage calculations. Former KBC offset customers should verify that their final offset benefits were correctly applied before transfer. Bank of Ireland couldn’t continue the offset feature, but your closing balance should reflect all offset savings up to transfer date.
Looking Ahead: The Irish Mortgage Market After KBC
KBC’s exit, alongside Ulster Bank’s departure, reduced lender choice in Ireland from ten to eight main players. This consolidation hasn’t prevented competitive pricing—most remaining lenders improved rates through 2024-2026 to capture market share.
Bank of Ireland now holds approximately 28% of the Irish residential mortgage market. They’ve shown little interest in offering former KBC customers retention rates matching their switcher rates, making the case for switching stronger for most transferred customers.
The market will likely see further consolidation. EU-owned lenders like Avant Money and ICS Mortgages are expanding, bringing additional competition that benefits consumers.
For former KBC customers, the transfer is complete. Your mortgage continues on the same legal terms, but you’re not locked in. Review your rate annually against current market offers. If you can save €100 or more monthly by switching and the numbers work over your remaining term, the Irish mortgage market in 2026 offers you clear options to reduce your costs.
See also: Switching Your Mortgage in Ireland | Mortgage Rates Ireland 2026 | Best Mortgage Lenders in Ireland | Breaking a Fixed Rate Mortgage | Mortgage Approval in Principle Ireland