Monday 12 November 2018

Banks profit as they pay the lowest savings rates in the ECB

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Charlie Weston Personal Finance Editor

SAVINGS rates in this country are the lowest in the Eurozone, even though we have some of the most expensive mortgages in the currency bloc.

The figures explain why banks here have been accused of making "supernormal" profits.

New figures from the European Central Bank show that savers can expect to earn just 0.04pc on fixed-term deposits.

This is the lowest rate among 19 eurozone countries.

If a saver puts €10,000 on deposit in a fixed-rate account for a year they earn just €4, before tax.

Elsewhere in the eurozone you can get 1.42pc in the Netherlands and 0.78pc in France.

Dutch savers will earn €142 a year on their deposit, and the French can expect €78, multiples of the €4 an Irish saver will get after a year.

The average rate across the 19 countries in the currency zone is 0.35pc, according to the ECB figures.

Despite paying miserable amounts on deposits, banks here also have some of the highest mortgage rates across the 19 countries.

Average mortgage rates were 3.11pc in July. Although down from a year ago, it is still higher than in other eurozone countries. The average across the Continent is 2.12pc.

Germans can borrow to buy a home at 1.94pc, with the French paying 2.2pc. In Finland the mortgage rate comes in at just 0.99pc. This means an Irish borrower is paying €2,200 a year more than in Germany, based on a €300,000 mortgage over 30 years.

"Savers in Ireland are being shafted by the banks when it comes to getting a decent return on their savings," said Daragh Cassidy of price comparison site Bonkers.ie.

Irish Independent

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