Sep 24, 2023

No Comments The profits of ING, Rabobank and ABN Amro are through the roof, thanks to the high interest rates of the European Central Bank. Last week the ECB raised its main interest rate for the tenth time in a row, to 4 percent. As a result, banks earn a lot of money on the deposits they have outstanding with the ECB. The ECB’s interest rate increases are barely reflected in savings rates, which are still very low. This leads to indignation among savers and politicians, but according to Klaas Knot the banks cannot be blamed for much. “Banks have good reasons for this. They have outstanding mortgages to which a lower interest rate applies. They take this into account when setting the interest rates on savings.” According to Knot, it is normal for savings rates to rise more slowly than ECB interest rates. “Banks have been confronted with a negative ECB interest rate for eight years, which they have not passed on to savers. Now the ECB interest rate is 4 percent and the banks are passing this on to savers with a delay. But the delay is not abnormal compared to of previous situations. The savings interest rate always lags behind the increase in the ECB interest rate.” Bank tax Knot expects that savings interest rates will continue to rise in the near future and that bank profits will decline. The Italian government is not waiting for that and has decided to impose an additional tax on the banks’ excess profits. Such a bank tax could also be introduced in the Netherlands. Knot calls this ‘a political decision’, but notes: “Let’s not make a policy for one year. Let’s see how this develops in the longer term. The banks’ profits are now exceptionally high. stay that high.” 2023-09-22 08:02:08