Sparkasse Ireland

zell12

Why are our politicians and CentralBank reluctant to let a german not-for-profit bank into our dysfunctional market?
It has €1.1 trillion in assets and would offer fantastic competition for consumers in terms or current, credit, savings & mortgage banking.
Surely, EU freedom of services is something we have signed up to?
https://www.sparkasse.de/

"We are also basically discussing the question to what extent a common-good-oriented, local banking model could shift the dysfunctional Irish banking market towards a higher level of competition, towards better services and better prices for Irish customers" https://www.independent.ie/business/world/sparkasse-to-tell-tds-it-is-deeply-convinced-model-can-work-in-ireland-36537394.html

Yggr of Asgard

Sparkasse is not a not-for-profit bank. It's a local organization bound together into an organization that operations in the whole republic via state bank organizations (of which some even went bankrupt and had to be bailed out by the Government which owns them).

A Sparkasse is a local saving & loan bank that is restrictive as to who can join (similar to credit unions). It's factually a Government controlled local bank that has to open a bank account to anybody in their catchment area (even before the EU rules about basic accounts came into force).

Most local operations do not offer free banking, in fact, Sparkasse operations tend to be expensive (which is why there are direct banks going after their customers). The only advantage is that you can get cash out of any Sparkasse for free with your Sparkasse debit card while other banks might charge you a direct access fee at the ATM.

Sparkasse only works because they rely on the older customer segment that does not feel comfortable with direct banks and prefers the "EC" card (local German bank card) over the modern Mastercard/Visa Debit card variants and who like to drop into the local branch for a chat.

They tried recently to enter the electronic banking by having an app under a brand "yomo" which allows you to do open an account via the app (like N26 etc.) but that still opens an account with a local branch and is not as flexible as direct banks. This was meant as competition to N26 etc but has severe problems due to cost, card type (maestro) and the fact that you still get it with a specific Sparkasse (they now opened it up so that you don't need to open the account with your regional Sparkasse but can choose a Sparkasse that has better terms for your use.)

In fact, under the EU rules, you could travel to Germany and open an account at a local Sparkasse if you manage to navigate the substantial paperwork and speak German. Some local organizations do offer to bank in English but most do german only.

They are also losing business to direct banks like DKB (which funny enough is owned by Bayern LB the state bank of Bavaria which is partly owned by the Sparkasse branches in Bavaria) or 1822 banking, the online variant of the Frankfurt Sparkasse. Those offer free banking with excellent conditions.

In theory, nothing stops an enterprising Sparkasse to open up a local branch in Ireland if the local Government will allow them. But the question is how they will do online banking, what card type would they use (as they can't utilize their standard bank card) and other stuff.

Giving that major Irish Banks are already in control of the Government (well in principle but in reality they continue to do what they want) there is not really the need to set up a whole new organization with extreme cost.

mihalk

It.s all about rescuing the Irish banks. They get their money at more or less 0% interest from the ECB. Mortgages are then generously made available at 4%.
I.e. joe public is being fleeced to rescue friends in banking jobs.
Now you don.t want to disturb this with the sparkaase offering 2% mortgages.

40% tax, 23% vat and 4% mortgages - amazing stuff

Jim2007

mihalk wrote: »

It.s all about rescuing the Irish banks. They get their money at more or less 0% interest from the ECB. Mortgages are then generously made available at 4%.
I.e. joe public is being fleeced to rescue friends in banking jobs.
Now you don.t want to disturb this with the sparkaase offering 2% mortgages.

40% tax, 23% vat and 4% mortgages - amazing stuff

Total nonsense, you clearly no nothing about banking or the role of ECB. The trackers came apart because the banks could not access funds at the ECB rate and never will. The ECB as a lender of last resort is very restricted, so the idea that banks can rock up and get funds to finance mortgage lending is pure fantasy.

mihalk

From the independent.ie

Gretchen Friemann
March 8 2018 2:30 AM




Bank of Ireland has tapped high levels of investor demand to issue a €750m covered bond backed by Irish residential mortgages in a deal that underscores the yawning gap between the rate it pays to borrow in international capital markets and what the bank charges customers.
Bank of Ireland issued the bond yesterday as investors continue to surge into a market propped up by long-standing support by the European Central Bank's quantitative easing programme.
The annual interest the bank will pay on the top-rated seven-year bond is 0.625pc, just 39.9 basis points over German government bonds costs.
:
A major reason banks pay so little to borrow on markets is ECB buying. At the start of last year it owned more than a third of the covered bond market.

__

I can't post a URL do a search on ""Bank of Ireland pays just 0.625pc to borrow for mortgage deals"


Of course I do bow to your superior grasp of banking!

Jim2007

mihalk wrote: »

From the independent.ie

Gretchen Friemann
March 8 2018 2:30 AM




Bank of Ireland has tapped high levels of investor demand to issue a €750m covered bond backed by Irish residential mortgages in a deal that underscores the yawning gap between the rate it pays to borrow in international capital markets and what the bank charges customers.
Bank of Ireland issued the bond yesterday as investors continue to surge into a market propped up by long-standing support by the European Central Bank's quantitative easing programme.
The annual interest the bank will pay on the top-rated seven-year bond is 0.625pc, just 39.9 basis points over German government bonds costs.
:
A major reason banks pay so little to borrow on markets is ECB buying. At the start of last year it owned more than a third of the covered bond market.

__

I can't post a URL do a search on ""Bank of Ireland pays just 0.625pc to borrow for mortgage deals"


Of course I do bow to your superior grasp of banking!

And where in that article does it support your claim that they get the money from the ECB??? It clearly shows that they securitized part of their loan book on the open market just like any other financial institution. They are a commercial institution and making a profit is exactly what they need to do to meet the Basle III/IV T1 capital requirements so they can stop relying on the state.

recedite

Yggr of Asgard wrote: »

Sparkasse only works because they rely on the older customer segment that does not feel comfortable with direct banks and prefers the "EC" card (local German bank card) over the modern Mastercard/Visa Debit card variants and who like to drop into the local branch for a chat.

I don't give a rap about what colour the bank card is, or whether I get a chat and a free cup of coffee.
All I want is to stop paying double the interest rates on my mortgage that people in other EU countries are paying.

Yggr of Asgard wrote: »

In fact, under the EU rules, you could travel to Germany and open an account at a local Sparkasse if you manage to navigate the substantial paperwork and speak German. Some local organizations do offer to bank in English but most do german only.

This is disengenous. Its not the language barrier, because most German bank managers speak excellent English. I know somebody who went over and tried it. Hypovereinsbank manager was at first were tempted, but after consulting higher up the chain of command the word came back as No. They will not give out loans for property in another jurisdiction.

Now you can say there is no direct EU rule governing that, but it is indirectly an EU failure to have such common standards and procedures that would allow a genuine competition and free trade in services.

Jim2007 wrote: »

And where in that article does it support your claim that they get the money from the ECB??? It clearly shows that they securitized part of their loan book on the open market just like any other financial institution.

And whats the difference between "securitizing a loan" and ECB money creation?
C'mon, stop trying to bamboozle people with this BS.
Its all part of The Great Bankster Rip-off, plain and simple.

Jim2007

recedite wrote: »

And whats the difference between "securitizing a loan" and ECB money creation? C'mon, stop trying to bamboozle people with this BS.  Its all part of The Great Bankster Rip-off, plain and simple.

Apart from the fact that one has absolutely nothing to do with the other...  Rather than ranting because you have no clue about the subject matter,  go and do some research and stop embarrassing yourself.  Oh and research means actual facts not listening to a bunch of talking heads.