DUESSELDORF, Germany, March 17 The European
Central Bank's negative interest rates are sparking demand for
safe deposit boxes, where bank customers can store cash to avoid
the prospect of paying the bank interest on their accounts,
German bankers said.
The ECB last week cut its main interest rate to zero and
dropped the rate on its deposit facility to -0.4 percent from
-0.3 percent, increasing the amount banks are charged to deposit
funds with the central bank.
"Lockboxes are in vogue," Hans-Bernd Wolberg, the chief
executive of German regional cooperative lender WGZ, told a news
conference on Thursday.
Some of WGZ's industrial or medium-size corporate depositors
are being charged negative rates for large deposits on a
case-by-case basis, but so far retail depositors have been
"With savers, we'll avoid it for as long as possible,"
German reinsurer Munich Re this week said it was
increasing its gold and cash reserves in the face of the ECB's
Some Germans public-sector savings banks in Bavaria have
already studied whether they should store cash in their own
safes rather than deposit it with the ECB, Georg Fahrenschon,
the head of the DSGV savings bank association, said this week.
While they found it was not yet worthwhile with the deposit
facility at -0.4 percent, some retail depositors were already
taking action, he said.
"Demand for customer deposit boxes is continuously growing,"
Fahrenschon said at the DSGV's annual results news conference.
Thin lending margins meant savings banks would need to
derive more income from charging fees to customers for services
that used to be free, he said.
"The days of free giro accounts are over," he said.
(Reporting by Matthias Inverardi, Andreas Kroener and Alexander
Huebner, writing by Jonathan Gould, editing by Larry King)