Moventum: Negative interest rates are history
The times of negative interest rates are over: The European Central Bank has moved its deposit rate back into positive territory. This in turn allows financial institutions to cancel their negative interest rates. Moventum is reacting particularly early: “As of 15 September 2022, our partners and their clients do no longer have to pay negative interest”, Sabine Said, CEO of Moventum SCA, pointed out. “We are passing on the European Central Bank’s key interest rate increases as quickly as possible.”
“Even though, measured by the value of the securities, we only charged negative interest for particularly high liquidity holdings, and then only for the shortest possible period, we are pleased to be able to hold the liquid assets free of charge again”, Said mentioned. “We aspire to offer attractive services for our clients in everything we do.”
In 2007, prior to the global financial crisis, the deposit rate of the European Central Bank (ECB) stood at 3.25 per cent. During the economic turmoil and the subsequent euro crisis, however, the ECB pushed the interest rate at which commercial banks can park money at national central banks down to zero. In 2014, the interest rate even turned negative, meaning that banks had to pay money for their deposits at central banks. This step was supposed to encourage the banks to lend money.
As a result, more and more commercial banks turned to charging their customers custody fees or negative interest rates. Now these times have come to an end: In combating inflation, the ECB has completed the interest rate turnaround. In July, the deposit rate was raised to zero per cent, and since mid-September it has been positive again. “That is why we were particularly pleased to see off negative interest rates in Luxembourgish with our customary ‘Äddi’, with a ‘bye’“, Said concluded.
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