Sunday, December 5

New deposit extratypes are far from 1%

Extratypes return to deposits, but not as we have known them. EBN Banco has just launched the Sinycon Plus Deposits.

The maximum profitability that offered by the entity is above the remuneration of the rest of the Spanish entities. Thus, the 24-month fixed term offers a remuneration of 0.60 percent at 24 months, the highest offered among the entities of the Spanish financial system.

In addition to this 24-month deposit, there are 3 other tranches with different returns designed to adapt to the needs of each client: 18 months (0.50 percent), 12 months (0.40 percent), 6 months (0, 20 percent).

This means improving, in the 18-month period, the other best offer from Spanish banks: Wizink offers 0.25 percent.

Negative real returns

The most conservative savers can allocate a part of their investment to deposits, as a way to guarantee capital and obtain certain returns, even if they are scarce.

Nevertheless, they should also take into account that as inflation is, real profitability (the difference between nominal profitability and inflation) is negative.

Inflation closed October in Spain at 5.4 percent, which means that the real profitability of these deposits in their longest tranche stands at -4.8 percent.

Small banks, the only one offering above-market deposits

The deposit market has been mortally wounded for several years, for various reasons.

The first of them was the intervention of the Bank of Spain in the midst of a war to capture liabilities that led entities to offer extratypes of up to 4 percent. The regulator imposed a series of limitations on their remuneration in accordance with the established deadlines.

Second, it was the role of the European Central Bank (ECB). When the financial crisis broke out, the agency cut the price of money to 0 percent in March 2016. At the same time, it placed the deposit facility at -0.50 percent.

These two events marked the market, in which the large financial institutions gradually became unmarked.

Only small entities, such as EBN Banco (specialized in this type of product and profitable) or Wizink (an online entity that seeks to attract liabilities and customers) managed to uncheck themselves.

Little optimistic outlook

The outlook for these products is bleak, experts say, who believe that it will be very difficult to see returns above 1 percent while interest rates are low.

Y, lany offers will come from online banking, that bear less costs, from entities that need to attract new customers and from foreign banks in Spain, for the same reason.

AND “These offers will be limited in time and in quantities”, the experts explain.

Payroll accounts, the only way to achieve extratypes

If what we are looking for are profitability that can beat or reduce the impact of inflation to the maximum, offers can be found in the market.

Nevertheless, the saver should know that these offers are fundamentally related to the direct debit of the payroll and that they will be limited in time and in maximum amounts to be paid.

Two are the names that sound strong in that sense. A classic is the Bankinter Payroll Account, which offers a remuneration of 5 percent for an amount of a maximum of 5,000 euros the first year and 2 percent the second.

The second entity is Openbank. The online bank maintains the offer of its Welcome Account with direct debit of the payroll, which offers a remuneration of 5 percent for the first six months.

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