It’s big banks: 1, savers: 0.
Many savers are fed up that they have earned almost nothing on their savings at the bank for years.
They thought there might be hope on Wednesday when the Federal Reserve, America’s central bank, finally raised interest rates for the first time in nearly a decade.
It was a small increase — 0.25% — but at least it was better than having rates at basically zero.
America’s largest banks wasted little time Wednesday announcing that they will start charging more interest for loans, starting tomorrow. But they also made it clear that they would be pocketing the money themselves.
Savers won’t get higher interest on their deposits, yet, at least from some of t he largest American banks.
At 2 p.m., the Federal Reserve announced that it was increasing interest rates.
By 2:12pm, Wells Fargo announced it would be raising the rates it charges customers for loans from 3.25% to 3.5%. A spokesman for Wells Fargo confirmed that the bank will not be raising the interest rate for savers.
U.S. Bancorp followed with its own statement at 2:54pm announcing the same increase to 3.5% on loans.
JPMorgan Chase told CNNMoney that it would also raise its so-called “prime rate” to 3.5%, but it would not be doing anything more for savers at this time.
“Any increase in rates is an opportunity to breathe a little life back into those [profit] margins.” Greg McBride, chief financial analyst at Bankrate.com, told CNNMoney.
McBride says the banks most likely to offer savers higher returns are online banks like Ally.
“As a consumer…we’re free to take our business elsewhere and shop around. That’s exactly what savers should do,” McBride says.
“We won’t automatically change deposit rates because they aren’t tied directly to the prime [rate]. We’ll continue to monitor the market to make sure we stay competitive,” a JPMorgan Chase spokesman said.
Bank of America did not return CNNMoney’s request for comment.
