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Swiss bank ABS plans negative interest rates for some depositors
October 16, 2015 / 7:10 PM / 2 years ago

Swiss bank ABS plans negative interest rates for some depositors

ZURICH, Oct 16 (Reuters) - The Alternative Bank Switzerland (ABS) is to introduce negative interest rates for some depositors next year, a spokeswoman said on Friday.

Many Swiss banks have been hit by deposit charges to keep cash with Switzerland’s central bank, a policy introduced in January to make the strong Swiss franc less attractive to foreign investors.

“On transactional accounts ... there will be negative interest rates of -0.125 percent from the first franc,” the ABS spokeswoman said, adding that this would come into effect from the start of next year.

At the end of 2014 ABS, which offers “ethical” banking services, had just over 33,000 clients. The deposit charge will apply to around 8,000 of them, she said.

The reason for the decision was that ABS’s strict investment criteria meant it kept a large portion of cash with the Swiss National Bank, she added.

Major banks like UBS and Credit Suisse have introduced deposit charges for some large clients but Swiss broadcaster SRF said ABS would be the first Swiss bank to introduce negative rates for smaller clients.

Reporting by Joshua Franklin; editing by Andrew Roche

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