Bank of Ireland has become the latest lender to announce changes to mortgage rates.

It has confirmed a cut in levels of interest imposed on fixed rate mortgages for new customers, which will now see them start at 3.8%.

The bank has also announced a new €2.5bn mortgage fund, and the extension of a stamp duty offer to the end of 2015.

The bank says the new fixed rates can also be applied for by existing customers on variable rates or those who are coming to the end of their current fixed rate term.

Aine McCleary is head of mortgages at Bank of Ireland.

"In addition to the range of new lower rates, the bank has extended this stamp duty offer for a further 12 months to 31 December 2015. According to industry statistics, the average mortgage taken out by someone moving house is €224,431, which makes this offer worth over €2,200 to the average customer moving to a new home," she said.

Ms McCleary added: "Our €2bn mortgage fund that we launched last year is now fully subscribed and we have launched a further €2.5bn fund to meet customer demand."

The announcement follows a similar move by Permanent TSB, which this morning unveiled a cut to its variable mortgage interest rates.