BOI Savings Rates

N

noshark

Guest
Why are BOI so low with their savings rates compared to other?
 
All banks have strategies when it comes to savings interest rates.

The strategy employed by BOI is largely ...

(1) To take advantage of consumer inertia/laziness by taking advantage of their large branch network. Hence, they pay close to zero on a lot/most of their savings accounts. They make a small fortune off customers who lack knowledge or willingness to shop around.

(2) As BOI's loans to deposit ratio has gone well over 100% lately, BOI have started to become slightly competitive with new products where existing customers won't benefit unless they take the time to switch product. They have launched new so-called "reward" accounts which are medium to long term deposit accounts. The objective as I see it is to to boost their deposit ratio and prevent the on going deposit leakage.


So, why are they not more competitive in general with savings products? Because simply they don't need to be.
 
They're right , if they can get the money cheaply, why not. If people started to withdraw they would be forced to react.
 
It is unfortunate that they are not more competitive. I have my current account there (through inertia) but nothing else. Everytime I get a call about new savings products I advise them that I can get a better rate elsewhere. It requires a little extra time to open up accounts in other financial agencies but with no incentive to keep my money with BOI it's their loss.
 
And don't be talked into putting your money into some of their Investment Products.
 

My own elderly father keeps very large sums of money in his current account. There is nothing on this earth that will persuade him to move it to a deposit account. "I might need it" is the phrase often used. But €50k?

The branch manager gives him a wave whenever he calls to the bank so he wouldn't like to upset the manager in any way by moving it. The same manager has never called my father aside and offered him any financial advice.

Yet my father would travel miles to save 10c.
 
That sad story is repeated up and down the country. BOI get away with giving your father zero interest while they loan the money out at a high rate.

I don't know what you do to persuade a 'die hard' AIB/BOI customer that it is significantly in their financial interest to switch. Perhaps, present the interest figures to them in paper and show much they will earn by switching.
 
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