Bank of Ireland has raised interest rates following last week's half a percentage point rise in official euro rates.

The bank's standard variable mortgage rate has been increased by 0.4 of a percentage point to 4.35 per cent from 3.95 per cent. All other lending rates, including those for personal and business loans, have been increased by the full half a point. The new interest rates will come into effect on November 12th.

Bank of Ireland has also raised interest rates for standard demand deposit accounts by between 0.1 and 0.25 of a point while reserve deposit rates are being increased by between 0.3 and 0.5 of a point.

To date, Irish Permanent is the only other lender to have raised rates in response to the European Central Bank move. It increased its variable mortgage rate to 4.39 per cent from 3.99 per cent.