Bristol and West has confirmed it will also be scrapping exit fees for future customers from July 31.
This follows Cheltenham and Gloucester’s announcement last week that it will be axing its £225 exit charge on all future lending.
Lenders had a deadline of July 31 by the FSA to sort out their fee structure.
Bristol and West are now the second top 20 lender to announce they will no longer charge exit fees.
The decision will apply to mortgages on both Bank of Ireland and Bristol and West brands.