Letter about updated product terms

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This month, ABN AMRO will send its clients a letter describing the updated product terms. It will also announce the new interest rates effective 1 April 2020. Starting 1 April, the bank will calculate the combined balance of each client’s checking and savings accounts every day. The client will then be assigned to one of three deposit categories, based on that combined balance: €0-€100,000, €100,000-€2.5 million, or €2.5 million and up.

Interest rates

From 1 April, every client – whether retail or commercial – who has deposited more than €2.5 million will be charged 0.5% interest per annum on the balance above €2.5 million. The other deposit categories, and virtually all retail savings accounts, will carry an interest rate of 0% effective 1 April; that was already the rate for individual commercial savings accounts.

5,200 clients

Besides some Private Banking clients and corporate and institutional clients who already pay negative interest, at the end of 2019 some 3,000 private individuals and 2,200 commercial clients had deposits above the €2.5 million threshold.

Saving deposits costly for banks

Savings deposits are increasing, despite the low interest rate environment. And saving deposits are relatively costly for banks. ABN AMRO pays 0.5% interest per annum on deposits placed with the European Central Bank.

Large clients

The bank already charges some of its clients negative interest, based on individual arrangements. Those clients are mostly large organisations that understand the financial markets and are aware that ABN AMRO itself pays the ECB a deposit charge (negative interest).

Low interest rate environment

With no foreseeable change in the current low interest rate environment, ABN AMRO has taken the decision to start charging interest on large deposits effective 1 April, and to update its regular product terms to reflect that.

No negative interest on deposits up to €100,000

ABN AMRO relieved the concerns of clients with smaller deposits last year when it announced that it will not charge negative interest on deposits up to €100,000.


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