Call for banks to increase interest on savings
Financial institutions hiked mortgage rates but many have not done the same for savers
REGIONAL treasury councillor Arcadi España has called on banks to increase the profitability of families’ and businesses’ savings.
“This would enable them to benefit from the rise in interest rates with a return on the deposits they have with financial and credit institutions,” he said.
“If financial institutions have passed on the rise in the price of money by increasing the interest rates of mortgages and personal loans, they must also act urgently to increase the interest on Valencia residents’ savings, who in recent years have not received any repayment for keeping their money saved in banks and savings banks.”
The treasury councillor’s demands echo those of the European Central Bank (ECB) and the Bank of Spain, which in recent weeks warned that, unlike when the Euribor rose in 2005 and 2010, this time financial institutions
have not passed on the higher interest rates to savings.
Sr España met with Manuel Illueca, the director of the Valencian finances institute (IVF), the regional government’s
public bank, and the director general of financial policy, José Moreno.
They analysed the financial situation of families and businesses in the region, and urged banks to ‘take steps as soon as possible to start repaying Valencian families and businesses for the resources they have saved and deposited in banks, savings banks and credit cooperatives’.
The latest report on deposit institutions, which corresponds to the third quarter of 2022, indicated that public and private deposits in the Valencia region amounted to a total of over €130.4 billion, of which families and businesses accounted for €124.5B, up almost 4% on 2021.
“This means that for every point of interest that banks fail to apply to Valencians’ savings, families and businesses miss out on €130.5M to reactivate the economy and cope with inflation and rising prices,” claimed Sr España.
He insisted it is ‘fundamental’ that the rise of almost 4% in interest rates over the last year and a half, ‘is not only passed on to families by increasing the cost of their mortgages and personal loans, but must also be passed on so that they receive an appropriate return from the banks for maintaining their deposits and savings at their branches’.