This is the second rate rise by the bank in as many months and will add around €30 a month to people’s mortgage repayments per €100,000 borrowed.
Around 70,000 mortgage holders are expected to be impacted by the latest increase.
The bank said that it was putting the rates up as its mortgage book is loss-making and it needs to return to sustainability.
Almost one in ten holders of the bank's residential mortgages are three months or more behind in their payments.
Chief executive David Duffy said the bank is "acutely" aware of the financial impact that any increase will have on its customers, but said that the move is needed to transform its operating base.
Bank of Ireland and ICS customers will also see their rates increase by 0.5% from 24 October.
