Why so many banks offer interest rates of four percent and more on the day money? Fixed-income investments despite constantly falling interest rates are currently the Renner – the interest rate of the European Central Bank is currently only at 2.00% and further interest rate cuts are considered safe offer some banks, including in particular direct banks, day money interest rates of more than 4.00% p.a. for an investment on the day money account. And also a Festgeldanlage interest rates so high are possible in the tip and investment horizons of two to three years, even over 5.00% per year. But why banks offer even such high interest rates, if they could get cheaper loans at U.S. banks and other credit institutions? One must remember that an investment in a bank by the principle is nothing more than a loan that is granted by the Bank.
The only difference here is that not the lender and the borrower decides how high are the interest to be paid. Why so so many banks offer significantly higher overnight interest rates, as it interest rates would actually require? The reason is the lack creditworthiness and the mutual distrust of banks. Money houses, which have to cope with heavy losses due to the current financial crisis, considered to be not just secure debtor, therefore often no other way of fresh money to get them, than to collect it at accordingly higher interest rates at a private facility. Because while multi-billion dollar loans from a bank can be considered lost, deposits by private facility are best protected by statutory and private deposit insurance in Germany. This means that a private investor receives back his capital spent a day money account or deposit account in the case of a bankrupt of Bank at least up to a certain amount, but usually located in the million range due to the deposit guarantee fund of German banks. Otherwise it would look with a much larger volume loan from another bank, this wouldn’t the awarded money in case of a default of the borrower get back.
The reason for such high interest rates on call money and term deposits is in the missing credit the respective bases they have simply no way elsewhere cheaper to get fresh capital. Therefore, there are currently especially the financial houses of the great German carmakers which offer high interest rates on investments. At the Mercedes-Benz Bank this caused recently to that meted out a stop for new account opening the Bank was no longer the many opening of accounts due to the high rate of interest offered able within an acceptable time to work through. As the day the Volkswagen account is offered but Bank, which with 4.00% p.a. and a very good product offers a monthly credit of interest.