Major Belgian banks are set to hike interest rates in the coming weeks, as the country's leading financial institutions appear to have partially succumbed to pressure from the Federal Government to align savings rates with the European Central Bank's (ECB) key policy rate.
On Friday, CBC (the French for KBC) announced that from 1 August rates on its regular savings accounts will rise, as will returns on its Start2Save and Start2Save4 accounts.
The announcement, which was reported by Belga News Agency, noted that the monthly base rate on regular savings accounts will increase from 0.35% to 0.45%, while the loyalty rate (offered for funds left in the account for at least one year) will rise from 0.25% to 0.45%.
Furthermore, the base rate on customers' Start2Save and Start2Save4 accounts (for which customers are only permitted to save up to €500 per month) will increase from 0.15% to 0.40% while the loyalty rate will rise from 0.75% to 1.10%.
CBC is not the only bank to have announced rate increases in the past few weeks. Argenta recently confirmed that it will hike customers' rates from 17 July, while MeDirect, Belfius, Keytrade Bank, Triodos, Deutsche Bank and vdk have all announced similar rate increases.
Despite the rate hikes, customers' savings rates remain well below the 3.5% rate earned by Belgian banks from parking their excess cash overnight at Belgium's central bank (the ECB's deposit facility rate).
