HSBC has become one of the biggest global banks to say that it will begin charging clients on deposits in a basket of European currencies.
The decision underlies the extraordinary measures banks are taking to prevent their profit margins being crushed in the record low-interest rate environment.
HSBC has written to other banks to warn that it will start charging them for deposits in euros, Swiss francs, Danish krone and Swedish krona — all currencies of countries that have negative interest rates — at its UK, German and Hong Kong operations from this summer. It is the first UK bank to introduce such charges after similar announcements from Swiss, German and Nordic institutions. “HSBC charges banks for deposits they hold with us in currencies where negative interest rates apply,” the UK lender said. “Banks affected have been notified and we continue to monitor the situation.”