ZKB Reserves Right to Set Negative Rates on Small Franc Savers
Zuercher Kantonalbank, Switzerland’s biggest publicly owned lender, said it reserves the right to set negative rates on the Swiss Franc deposits of small savers.
Customers would be able to withdraw as much as 100,000 Swiss francs ($108,755) per month without charge “in case of the implementation of negative rates,” the Zurich-based bank said in a 2013 edition of terms and conditions for private current and savings accounts.
ZKB’s move comes after UBS AG (UBSN) and Credit Suisse Group AG (CSGN), Switzerland’s biggest banks, said last month they would start charging financial institutional clients for cash balances held in francs. Swiss newspaper Tages-Anzeiger reported earlier today that ZKB had revised account conditions so that the introduction of negative rates was possible.
The franc declined against the euro after the report, weakening to as low as 1.21270 and traded at 1.2108 as of 3:53 p.m. in Zurich.
Switzerland’s central bank imposed a cap of 1.20 francs per euro in September 2011 to protect the economy after investors seeking a haven from Europe’s debt crisis pushed the exchange rate toward parity. SNB spokesman Walter Meier declined to comment.
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