Savings hit new highs, banks drive away customers with low interest rates

Savings hit new highs, banks drive away customers with low interest rates Americans' fear of a second economic recession has deepened, and they have deposited cash in financial accounts, with savings amounts reaching a record high of nearly 10 trillion yuan...

Savings have hit new highs, banks have low interest rates and drive away customers. Americans' fear of a second economic recession has deepened, and they have deposited cash in financial accounts. The amount of savings has hit a new high of nearly 10 trillion yuan. Since banks don't need so much money, they have no choice but to offer low interest rates to discourage customers. This wave of savings shows no sign of cooling down. In the past three months, the amount of accounts in U.S. commercial banks has surged by 429 billion yuan, an increase of 10%, almost double the amount in all of last year. The problem is, the bank doesn't need the money. Banking industry consultants say banks and credit unions are trying to get rid of as much cash as possible and just hope to increase lending. He said that banks refuse to allow customers to renew their time deposits at higher interest rates and charge handling fees to depositors who only open checking accounts, hoping to discourage customers from depositing, even financial institutions that make money are no exception. Wells Fargo has cut its one-year time deposit interest rate in half to 0.1%, while Citigroup, which set the time deposit interest rate at 2% in 2009, has also cut its interest rate to 0.3%. Bank of New York Mellon (BNY Mellon) even charges large deposit customers a fee if their deposits exceed $50 million in a single account. Low deposit interest rates are a punishment for retirees and people who rely on interest. According to the U.S. Bureau of Economic Analysis (BEA), the amount of deposit interest fell to 546 billion yuan last year, far lower than 903 billion yuan in 2008. The Federal Reserve has promised to keep interest rates at a record low of nearly zero until mid-2013, which will surely make depositors more miserable and force banks to treat new deposits strictly.