Good Finance currently offer the same savings rate. And with an interest rate reduction of 1, the 2 others follow quickly. Coincidence, or is there more to this?
Savings interest rates the same at all major banks
Have you also noticed that the three major banks often offer the same savings rate? And if, for example, ING has lowered its interest on savings, it will not be long before Good finance also lower their interest on savings? Is this a coincidence or is it more behind this?
More insight into the interest policy
A recent interview by NOS with Good Finance chairman Wiebe Draijer gives more insight into the interest rate policy of the major banks. Draijer is asked about Good Finance’s low savings interest. This while the bank makes a high profit at the same time. Can’t it be otherwise; wants to know the US.
The answer is ‘no’. Good Finance, indicate in the article that savings are currently costing too much. Due to the low interest rate, savings on the money market hardly yield anything. If they store the savings at the European Central Bank (ECB), they even pay a penalty interest for this.
Savings interest of 1% would mean half the profit
The US calculated that an increase in savings interest to 1% by Good Finance would cost around 1.2 billion euros. This would almost halve the bank’s profit. Now of course you don’t have to feel sorry for the big banks. Yet it is good to realize that the profit does not only disappear in the pockets of the bankers.
Making a profit also means that banks can strengthen and innovate their capital buffers. A healthy bank ultimately benefits the customer. Through profit tax, dividend payment to pension funds, among other things, and financing of economic growth, society ultimately also benefits.
Competing on savings interest is unfavorable for banks
Back to the interest rate difference between the major banks, or actually the lack thereof. In the interview with NOS, Good Finance chairman stated that ‘large differences in interest rates are actually irresponsible’. This would cause ‘huge movements between banks’ (from savings, ed.).
If banks cannot use the new savings, they must store it at the ECB. The central bank is currently charging an interest rate of -0.4% for this, which is negative. More savings also means that there must be a higher capital buffer. A bank that is currently competing with a higher savings interest rate therefore cuts its finger on itself.
Price agreements between banks are not allowed. As long as the European Central Bank does not change its interest rate policy, savings rates will remain low. Good Finance expects this to last until at least 2021. Read more about savings interest expectation in 2019.
Where can you find a higher savings interest?
For a higher savings interest you don’t have to go to the big banks for now. Where then?
- Choose a savings specialist with a freely withdrawable savings account (up to 0.35%).
- View the range of deposit savings with various interesting foreign banks (up to 1.75%).
- Choose saving with conditions, such as monthly saving or savings insurance. (up to 2.00%).
Not saving, but more return on your assets? View the options for investing.