The interest rate storm in bank deposits reaches the Knesset: “Raise it immediately”

by time news

The finance committee is expected to hold a special meeting at the beginning of September regarding the interest rates on bank deposits – after this was raised only partially, after the interest rate increase in the economy.

Yesterday it was published in “Calcalist” that the banks rolled on average only one third of the last interest rate increase that took place last week, into the deposits – so that on a monthly fixed interest deposit the interest is on average about 0.5%.

The Chairman of the Finance Committee, MK Alex Kushnir, sent a letter this morning to the CEOs of the banks on the subject: “One of the effects of this decision by the Governor (increasing the Bank of Israel interest rate – AA) is a significant increase in the price of loans that were given by The banks to the public, both existing loans with a prime component and new loans. However, the interest on deposits that the public holds in the banks did not change at the same rate, thus creating gaps that significantly increase the profitability of the banks, but make it even more difficult for the saving public. I demand that you act to raise The interest on the public’s deposits held with you immediately, in order to maintain the financial value of these deposits in a challenging period”.

At the same time, Kushnir also sent a letter to the supervisor of the banks, Yair Avidan, and demanded that he intervene in the issue: “I request your intervention as a regulator for the purpose of raising the interest rate on the public’s deposits held in the commercial banks immediately.”

As far as is known, Avidan tried to pressure the banks to improve the interest rates on deposits through talks with their heads, but it seems that so far no substantial change in pricing has been registered.

The Knesset has indeed dispersed, so the ability to promote a legislative initiative or exert pressure on the banks is relatively limited. However, Kushnir’s move may be the beginning of a process to intervene in the issue, which will accelerate after the elections and the existence of a functioning Knesset.

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