Rabo leaving it late....to announce new rate

From the 1st of January 2008, you'll get a rate of 4.3% on balances up to 1 million EUR and a rate of 3.95% on balances over 1 million EUR.

It was 5% for balances <=10,000 last year That's a pretty hefty drop in rates methinks.
 
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In fact, at RaboDirect if you have a deposit €23,000 or more, you'll be better off in terms of the interest you'll earn for 2008!
 
If you have €23K or more you can still do better by splitting it between higher interest accounts such as the First Active E-Saver (5.22%) and the AIB Online 7 day account (5%)

€150 per year better, in fact.

People should be voting with their feet (and their money) - inertia is the banks' best friend.
I am doing my bit - all my Rabo capital deposit has gone to FA and the interest payment I received today has also already been transferred to FA.

Unfortunately most money probably will stay at Rabo despite the drop.
Most people will not be aware of the rate change anyway - they aren't exactly shouting it from the rooftops - website still bangs on about 5% and I haven't heard any press ads announcing the new rate.
 
Was thinking the exact same thing as you John.

Another interesting note is that you can still earn a tiny bit more (.03%: 4.33% versus 4.3%) on savings of 1 million EUR with FA than with Rabo. So unless your extremely loaded with cash and want to keep it in the one place, Rabo wouldn't be the first port of call. FA also has the advantage of people staying with them due to the 5.22% on the first 15K.

Logic also dictates to spread out savings as:
-Take advantage of banded rates to max returns
-By spreading it out between different banks you minimise risk(there's a 20K upper limit on the deposit protection scheme I believe?... so more accounts means more protection for the sum total of your savings)

Yep so the only conclusion one can draw is that Rabo is heavily relying on customer inertia.
I think the general feeling on the forum is one of disappointment with Rabo. FA and even AIB have given experienced savers pause for thought on Rabo, and there's even some 4.5% accounts out there(granted not as flexible, though for the sums Rabo is aiming at if you're loaded by that much.....).
Since Rabo is a virtual bank you'd expect it to offer more attractive rates than brick and mortar banks.. hence the disappointment.

To Rabo's credit they are one of the easiest banks to get up and running with and brought along innovative security and currently have an acceptable interest rate, but for the experienced saver they have probably moved from a primary to tertiary place for deposits.
 
Rabo have increased the rates for the majority of their customers - so anyone who didn't move before won't be moving now. Certainly not for 0.03% (some with a million on deposit isn't going to be fussed about 300 euro). The other banks are playing catch up so they've no choice but to beat Rabo's rate - and as such Rabo would be commercially silly to try to set the highest rate.

Banding is annoying - FA's banding took ages to work out in a thread here last year. Trying to take advantage of banding with multiple accounts is also annoying - and possibly distracts people from taking long term investment decisions with their savings.

I doubt it make long term sense to band anyway, at least in the previous Rabo and current FA way of having a better rate for less money. A bank would prefer a single customer with 100k than 10 with 10k. The whole thing was to grab SSIA customers, probably with the intention of selling them loans later.

My guess is that Rabo has discovered these 10k customers have little intention of using that revolving credit facility thing they were advertising, so don't mind too much if they lose them.

On another point Rabo have better deposit protection than most, being Dutch they guarantee the first 20k and 90% of the next 20k.
 
ashambles said:
Rabo have increased the rates for the majority of their customers - so anyone who didn't move before won't be moving now.
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I have moved. I didn't have €23K+ with them in a single account though. Left €1 in each account just to keep them open.
 
It would be great if at least their rate would at least match the 4.50% of many other lump sums accounts... But probably they calculated that the AAA rating "pays" the difference of 0.2%... Because of this then I prefer to spread my savings to other accounts for the moment...
 
Just want to say thanks for the info posted here. My husband and I have 10K each with Rabo. We will look into moving 15K to First Active now.

C
 
Carmel said:
Just want to say thanks for the info posted here. My husband and I have 10K each with Rabo. We will look into moving 15K to First Active now.

C
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Why not just open two accounts - one in each of your names?
 
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