OLB: Customer deposits welcome – new approach to custody fees
- Oldenburg | 21. April 2022
Summary
- Bucking the trend: Significant increase in exemption limits effective immediately
- Customers benefit from attractive services
April 21, 2022 – According to various evaluations of comparison portals, an increasing number of credit institutions in Germany are charging custody fees for their customers' deposits - and apparently with ever lower allowances. Oldenburgische Landesbank AG (OLB) has now become one of the first banks in Germany to opt for the opposite approach: It is raising the allowances for private customers very significantly, effective immediately.
"Bucking the trend in the financial industry, our customers as well as potential new customers are very welcome to make deposits with us," says Aytac Aydin, member of the Board of Managing Directors responsible for the retail business. "We offer attractive opportunities: Those who invest their assets with us now benefit from noticeably increased exemption limits on the custody fee." The bank is quintupling to tenfold the fee limits for certain models: For the premium products checking account L and checking account XL the exemption limits rise to EUR 2.5 million (m) and EUR 5 m, respectively (more details on the individual account models here).
"Our checking account L in particular was recently named the second-best checking account with personal service in Germany in an exclusive evaluation for WirtschaftsWoche magazine. And the exceptionally high exemption limit for the custody fee in a market comparison is an example of how we are constantly improving the account services," says Aytac Aydin. New customers who opt for the checking account L by June 30, 2022, can test this account model free of charge for the first six months.
Along with the changes to the account models, the exemption limit for the custody fee on overnight deposit accounts has also risen significantly from EUR 100,000 to EUR 500,000. In addition, the Bank is again offering traditional time deposits with terms of 1 to 5 years for private and commercial customers. With these steps, OLB wants its customers and new customers to benefit already today from the prospects in the interest rate market, where a turnaround toward more pleasing interest rates is gradually becoming apparent.
OLB uses customer deposits in particular as an essential instrument for refinancing the loans it issues. As of December 31, 2021, OLB reported an increase in its loan volume to EUR 17.0 billion (bn) (previous year: EUR 15.5 bn), while customer deposits rose by EUR 1.1 bn year on year to EUR 14.1 bn as of the same reporting date. Pfandbriefe are another instrument for diversifying refinancing. Most recently, on April 6, 2022, OLB successfully placed a sub-benchmark Pfandbrief with a total volume of EUR 350 m with national and international buyers such as banks and savings banks, asset managers and central banks. OLB will also continue this capital market presence to adequately support its strategic growth course.