ECB stats: Irish Deposit Returns Now Worst in Eurozone

Hi Ciarán

That is astonishing.

I am now beginning to wonder if the ECB is just plain wrong. They are wrong on mortgage rates because the Central Bank includes trackers as new business.

I find it hard to believe that in an era when the ECB rate is 0%, that banks are paying 1.4% and 1.69% to depositors. They might be paying it on regular savings up to €100 a month or something, but I doubt if I could go into a French bank with €100,000 and get 1.4% interest. Can they not get the money much more cheaply elsewhere?

Brendan
 
This data is extremely suspect, you have to wonder if they are comparing similar terms.
 
One can get 1.4% AER gross and higher in France. Big retail French banks will not pay this but you can get it from other banks in France. A comprehensive list (but badly designed) list of French deposit rates is here: [broken link removed]

Can banks get money cheaper elsewhere? Some banks can but many banks prefer to be funded by deposits rather than Central Bank funding or intra bank funding, they are willing to pay a premium for deposits, especially new deposits.

Broadly speaking I think the ECB deposit stats are accurate.

There is a big discrepancy between rates on offer in the likes of Greece / Italy / Cyprus / Malta / France versus the likes of Ireland / Luxembourg / Germany.

ardmacha said:
you have to wonder if they are comparing similar terms.
Click to expand...

The duration is clearly stated in the Eurostat / ECB stats. I would be shocked if they are not correctly capturing this in the majority of cases.
 
I'm lost.:(

The Irish Times article seems to mix up average new household term deposit rates with maximum overnight rates in the same article.

I suspect the rates on outstanding term deposits and overnight (instant access) rates here are still well above the EZ average.

RaboDirect no longer offer instant access rates @ 1% as suggested so I'm not confident about the accuracy of the analysis presented. Are we being given a balanced picture or is this an exercise in data mining to justify a headline?

Many of the higher French rates in Ciaran's link only appear to apply to limited amounts but I'm afraid my French isn't up to figuring out what other terms are applicable to these deposits (term, penalties for early withdrawal, charges, etc.).
 
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In Ireland, the average rate on new fixed rate household deposits in March 2016
Click to expand...
Taken literally this means that the figures ignore how long the fix rate is for. It wouldn't surprise me if fixed rates are unpopular in Ireland and when taken out are for relatively short terms (due to the memory of how risky a long term deposit felt a couple years ago). It also wouldn't surprise if on the other hand Dutch savers will put money away for a longer time.

Anyway comparing Rabo Ireland the rates are

10 years 1.00%
5 years 0.40%
4 years 0.20%
3 years 0.10%
2 years 0.05%

Rabo Netherlands is
2 years 0.15%
3 years 0.20%
4 years 0.30%
5 years 0.50%
6 years 0.60%
7 years 0.70%
8 years 0.90%
9 years 1.00%
10 years 1.20%
11 years 1.40%
12 years 1.60%
13 years 1.70%
14 years 1.90%
15 years 2.00%
16 years 2.05%
17 years 2.10%
18 years 2.20%
19 years 2.25%
20 years 2.30%

Pretty much the same, except there are longer terms available in NL.

https://www.rabobank.nl/particulier...ticulieren.sparen.spaarrekening-en-spaarrente

[broken link removed]

(I'd recommend using Google Chrome as your browser if you want to translate any site.)
 
The term is important. There is a difference in these statements
"interest rates are lower in Ireland"
"for the mix of term accounts opened, the average interest rate is lower in Ireland"
 
Sarenco said:
I'm lost.:(

The Irish Times article seems to mix up average new household term deposit rates with maximum overnight rates in the same article.

I suspect the rates on outstanding term deposits and overnight (instant access) rates here are still well above the EZ average.

RaboDirect no longer offer instant access rates @ 1% as suggested so I'm not confident about the accuracy of the analysis presented. Are we being given a balanced picture or is this an exercise in data mining to justify a headline?

Many of the higher French rates in Ciaran's link only appear to apply to limited amounts but I'm afraid my French isn't up to figuring out what other terms are applicable to these deposits (term, penalties for early withdrawal, charges, etc.).
Click to expand...


They do but that will change on 31/05/2016
 
pudds said:
Their reducing the rate to 0.60% but currently it's 1% which would apply to when this survey was taken and so is accurate imo
Click to expand...

Who is reducing what rate to 0.6% at the end of this month? What rate is currently 1%?
 
Ah, thanks. I forgot that the announced change doesn't take effect until the end of the month - my mistake.
 
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