Swiss banks now charging to hold francs
A growing number of Swiss banks are charging customers to hold Swiss francs after the country's central bank decided to collect interest on the lenders' own deposits.
Credit Suisse Group AG said it plans to charge institutional customers and large corporate clients interest to hold some assets. UBS Group AG is considering similar action.
Neither of Switzerland's two big banks disclosed the fees.
Geneva's oldest bank, Cie Lombard, Odier SCA, began charging yesterfday for cash accounts it doesn't manage and that have a balance of more than 100,000 Swiss francs (€100,000).
The bank said the rate would be 0.75pc, the same as the charge on sight deposits imposed by the Swiss National Bank last week.
Zuercher Kantonalbank, Switzerland's biggest state-owned cantonal bank, said yesterday that it will also charge 0.75pc on some large deposits and may change terms for savings and other accounts.
The Swiss Central Bank (SNB) stunned currency markets a week ago by ditching its three-year-old cap on the franc and further slashing rates on sight deposits, the cash-like holdings commercial banks keep with the SNB.
Since then, other central banks have also loosened the tap on money. The Bank of Canada lowered its rate on overnight loans on Wednesday in response to the plunge in oil prices. On Monday, Denmark delivered a surprise interest-rate cut to restrain the krone.
Already, some banks began charging customers for depositing large amounts of euros after the ECB switched to negative deposit rates in June. They included Credit Suisse, Bank of New York Mellon, JPMorgan Chase & Co and Commerzbank. (Bloomberg)