European Central Bank (ECB) negative interest rates
More and more banks and savings banks pass on the negative interest rates of the European Central Bank (ECB) to private or business customers. This is shown by an investigation of more than 1,200 banks and savings banks by the consumer portal biallo.de. At present, 35 financial institutions are demanding a so-called custody fee from wealthy private customers, in part already for deposits of 100,000 euros or more on the giro or overnight money account.
Exemptions
14 of the 35 banks and savings banks have already adjusted their custody fee to the tightened ECB deposit rate of minus 0.5 percent – including large institutions such as Berliner Sparkasse, Berliner Volksbank or Sparkasse Hannover. In addition, the allowances, which are exempted from the penalty interest, were significantly reduced in some cases. Other major financial institutions, such as Hamburger or Nassauische Sparkasse, are leaving their custody fees at minus 0.4 percent for the time being. The allowances are still at 500,000 euros.
Penalties
For business customers and institutional customers, biallo.de now has 127 banks that record high deposits with punitive interest rates. As some of them also collect a custody fee from private customers, the total number of banks and savings banks is 131, which charge negative interest rates. The number could rise in the coming weeks. Because many institutions are considering the introduction of penalty interest if the ECB further tightened its deposit rate.
However, Horst Biallo, founder and managing director of biallo.de, does not expect a widespread introduction of negative interest rates for small savers: “The risk that customers would migrate, would be too large.” The expert instead assumes that the financial institutions continue to increase the fees around the current account. “According to our latest research, almost every third bank has turned the price screw this year,” says Biallo.
MoneyTalk6 