European banks paid a record 7.5 billion euros on their surplus deposits in 2018 alone, amounting to 21 million euros being paid to the ECB daily.
Charges had a considerable impact on banks’ profitability, equating to a 4% decline in profits in 2018.
European banks have transferred 21.4 billion euros ($24.2 billion) in revenues to the European Central Bank (ECB) in the five years since negative interest rates were introduced.
The ECB introduced negative interest rates on June 11 2014, lowering its deposit rate to -0.1% in a bid to stimulate the economy, and negative interest rates are currently at -0.4% on central bank deposits for 17 eurozone countries.
The negative rates were intended to discourage banks from parking cash with the ECB rather than lending it out or investing it.
European banks paid a record 7.5 billion euros on their surplus deposits in 2018 alone, amounting to 21 million euros being paid to the ECB daily, according to a report from open banking platform Deposit Solutions.
German banks account for a third (33%) of all eurozone deposit charges from 2016 to 2018, with French banks accounting for a further 24% and Dutch banks paying 13% of total charges…