• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar

Stock Trend Alerts

Essential Market Ideas and Investing Strategies

  • Newsletter Reviews
  • Hot Stocks
  • Technology
  • Financial News
  • Secrets of the Pros
  • Analysis
Home » Are Banks in Europe Charging Customers to Hold Cash?

Are Banks in Europe Charging Customers to Hold Cash?

Banks in Europe are doing the unthinkable…

They're turning away large cash deposits. I'm not kidding…

Deutsche Bank, one of Germany's top lenders, is effectively turning away many deposits of 100,000 euros or more. And if it does accept your deposit, then it will charge you a 0.5% annual fee to keep your money in the bank.

You're paying the bank to hold your cash. And at 100,000 euros, you're losing 500 euros a year in negative interest.

If this sounds a bit crazy… well, it is.

Today, I'll explain why it's happening…

We've gotten used to near-zero interest rates at major banks since the global financial crisis. But paying them interest on your savings? That feels like an idea from another planet.

It's happening all over Europe, though. The same is true for Commerzbank, Germany's second top lender.

Here's what a Commerzbank spokesperson had to say about it in a recent Wall Street Journal article…

Our primary objective is not to collect such a deposit, but to advise and reallocate funds to other forms of investment.

The fees are a tool to drive new large deposits elsewhere. And customers are getting the message.

One customer moved his money away from Commerzbank. His reasoning – shared in the same article – is incredibly obvious. As he put it…

I wouldn't mind receiving nothing for my deposit, but being asked to pay is just too much.

With rates going negative, folks can't stand the idea of losing money on their accounts. It's a call to action like we've never seen before.

[Exclusive: Man Who Made EIGHTEEN 1,000% Recommendations Unveils #1 Stock]

More than 230 banks in Germany alone are charging fees like this to private customers. While negative rates have been around in Europe since 2014, this is a relatively new phenomenon.

In 2014, when the European Central Bank first started charging banks negative rates, European banks pledged not to pass the cost to customers. For six years, they were able to eat the negative cost and still be profitable. That's no longer the case…

With pandemic uncertainty, and people saving more due to staying home, folks have flooded banks with cash.

Deposits are a liability for banks. The more deposits a bank holds, the more money it has to store away at the central bank to cover those liabilities. Before the pandemic, this wasn't a big deal… Banks could cover the negative rate charged by the European Central Bank and still profit on large deposits.

But with deposits through the roof, they can't afford to eat that negative rate anymore. So they are either charging fees or turning away potential customers, using new online tools to guide folks elsewhere.

This is truly crazy. Banks thrive when they're able to grow deposits. But now, they're actively trying to avoid it. And everyday customers are facing the unbelievable scenario of paying to deposit their cash.

If you don't live in Europe, this might not affect you personally. But this crazy banking quirk does mean something big for all of us as investors.

Folks in Europe now have a few ways to handle their cash…

They can pay a fee to store it at a bank – or earn zero interest, in some cases. They can keep it under the mattress, which isn't ideal. Or they can put that money to work somewhere else… like the stock market.

[Read On: Legendary Stock-Picker May Have Cracked the Code to 1,000% Gains!]

That's exactly what these low-interest-rate policies are designed to do… get folks investing. And with negative rates pushing Europeans out of the banks, that's a near certainty in the months ahead.

Good investing,

Steve

Read more from Steve Sjuggerud at DailyWealth.com

You Might Also Like...

  • Jeff Brown: 20,000 IPOs in One Day, and the $2.1 Quadrillion Shift to Tokenization
  • Jeff Brown and Web 3.0: Striking It Rich in the NFT Gold Rush
  • Jim Rickards "Bloody Wednesday" Newest Prediction
  • Three Penny Stocks to Add to Your Watchlist in 2022

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Primary Sidebar

Subscribe to Stock Trend Alerts

By submitting your email address, you give Stock Trend Alerts permission to deliver investment research to your email inbox. Privacy Policy | How It Works

Popular Posts

  • Martin Weiss Docket No. OP–1670: 12 Inflation-Beating Stocks
  • Jim Rickards – The Return of American Energy: Profit from the Green Lie
  • Andrew Zatlin: Biden’s Puppet Master Exposed and How to Opt Out of the Digital Dollar
  • Why 2023 Could Kick Off a “Cash Frenzy” in Stocks
  • Dylan Jovine 21st Century Battlefield: 4 Companies Changing Warfare
  • Infinite Energy Stock: The Tiny Company Dominating Tesla in the Trillion-Dollar Green Energy Race
  • Dylan Jovine Search & Destroy: 3 AI Software Stocks Revolutionizing Warfare
  • BREAKING: Military to spend billions on “Living Missile”

Recent Posts

  • 25 Super-Woke Companies You Do Not Want in Your Portfolio with Alexander Green
  • Jeff Clark Trader: The Currency Trading Retirement Blueprint
  • Jason Williams Blue Gas: The Tesla Killer Fuel Cell Revolution
  • Andrew Zatlin: Biden’s Puppet Master Exposed and How to Opt Out of the Digital Dollar
  • The AI Takeover: Jason Bodner’s Quantum Edge Trader Smart Tech

Topics

AAPL Advertorial Amazon AMZN Artificial Intelligence Battery Bear Market Biotech Bitcoin Blockchain Clean Energy Cloud Computing Coronavirus COVID Creative Cryptocurrency Dividends E-Commerce Electric Vehicles Elon Musk Energy Ethereum Gold Growth Stocks Inflation Interest Rates International Jeff Brown Louis Navellier Market Crash MSFT Oil and Gas Options Prediction President Biden Recession Retirement Russia Semiconductor Supply Chain Tesla The Fed TSLA Volatility Warren Buffett

Copyright © 2023 · Stock Trend Alerts - Essential Market Moves and Investing Ideas

Nothing on this website should be considered personalized financial advice. Any investments recommended here in should be made only after consulting with your personal investment advisor and only after performing your own research and due diligence, including reviewing the prospectus or financial statements of the issuer of any security.

Stock Trend Alerts, its managers, its employees, affiliates and assigns (collectively "The Company") do not make any guarantee or warranty about the advice provided on this website or what is otherwise advertised above.

The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. The Company is not affiliated with, nor does it receive compensation from, any specific security.

To the maximum extent permitted by law, the Company disclaims any and all liability in the event any information, commentary, analysis, opinions, advice and/or recommendations provided herein prove to be inaccurate, incomplete or unreliable, or result in any investment or other losses.

About Us | How it Works | Privacy Policy | Terms and Conditions | Contact Us