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Becuase deposits are generally the cheapest way to finance a mortgage.
Banks also have to meet certain solvency requirements.
Mortgage lending rates maybe but definitely no unsecured personal loan or credit card rates!But they seem to offer some deposit accounts with rates above lending rates.
But they seem to offer some deposit accounts with rates above lending rates. Also if they repackage and sell lonas on then it is no longer on their books and so the solvency requirements would not apply?
Finally since customer deposits are really loans to the bank surely they can borrow from other banks to meet solvency requirements. Which would be cheaper and less hassle.
In order to loan the money in the first place, before they package it up as a bond, they have to have a certain amount on deposit. You suggest that they could just borrow the money from other banks - where would they get the money - it has to come from somewhere.
BTW I fully accept that they do need deposits just that the answers people have given so far do not explain it
BTW I fully accept that they do need deposits just that the answers people have given so far do not explain it
not even on an ATM when you are taking out money?No financial institution ever unilaterally tried to flog me a loan or other credit product while I was a current/savings account customer.
No financial institution ever unilaterally tried to flog me a loan or other credit product while I was a current/savings account customer.
What is the liquidity ratio required by Irish banks?
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