Bank of Ireland has launched a new mortgage product that will pay out a 10 per cent bonus on regular savings by first-time buyers who then take out a home loan with the institution.

The offer will be available to customers who open a MortgageSaver account. It is designed to assist first-time buyers in putting together a deposit before drawing down a Bank of Ireland home loan.

The maximum bonus that will be paid out by Bank of Ireland is €8,000, which would mean that a borrower would have to save €80,000 in their account.

Customers can save from €200 to €2,500 by direct debit per month and have the option to make a lump sum lodgement of up to €20,000 into the account within 30 days, which will count towards the bonus.

This is the latest enticement to borrowers by Bank of Ireland as it attempts to build its share of new lending.

The bank is also offering 2 per cent cashback on residential mortgages until the end of June.

Commenting on the new product, Brian Vaughan, head of savings and investments at Bank of Ireland said: "We understand the issues faced by first time buyers saving for their first home, particularly with rents increasing steadily and a higher deposit required, which is a significant challenge for many.