In recent meetings with bank executives, German Finance Minister Olaf Scholz has warned them against applying negative interest rates on retail deposits, he said in an interview with Bild on Sept. 16.
The minister made it clear to the bankers it would not be a good idea to pass on the rates to savers, he told the German newspaper. Scholz believes the warning will be enough and a ban on negative rates on retail deposits is off the table, according to the newspaper.
The ECB on Sept. 12 decided to further reduce its deposit rate to negative 0.5% from negative 0.4%, triggering unfavorable reactions in Germany. Scholz later reassured German savers they would not face any negative rates on their deposits and said the government is working on potential measures if necessary.
Bild itself portrayed ECB President Mario Draghi as "Count Draghila" who is "sucking dry" German savers' accounts.
In a recent statement, Herbert Hans Grüntker, CEO of German state-owned lender Landesbank Hessen-Thüringen Girozentrale, or Helaba, told journalists that the bank plans a "noticeable" headcount reduction amid the low-rate environment and increasing pressure from higher regulatory costs and the fierce competition, Manager Magazin reported Sept. 16. The CEO did not indicate a concrete number of job cuts. Helaba, which serves as the central institution for public savings and loans banks in the states of Hess and Thuringia, employs 6,100 people.
