Montepio increases charges threshold
Montepio bank is to increase its charge-free account management threshold from €5,000 to €10,000.
It means that from now on only account holders with €10,000 or over will be exempt from current account charges.
With historically low interest rates and increased competition from on-line banks with minimal physical infrastructure, banks are having to introduce more account management service charges in order to survive.
The mutual bank has had a difficult time in terms of profits over the past 10 years. In 2010 its profits were €51.4 million. By 2013 profits were wiped out by almost €300 million in losses. In 2018 profits stood at only €12.6 million.
Clients that open new accounts with the bank will also face losing the three month exemption period from account maintenance charges that the bank used to offer.
Banco Montepio has published changes to its bank charges which come into force on 1 October 2019 on its site this week.
With regard to commission rates, these will be set at €5.20 per month, corresponding to an annual charge of €62.4, the same that had applied to clients with deposits up to €5,000.
By this move Montepio is following the policies of rival banks such as Santander and BCP which also raised the charges-free account management threshold to €10,000 or over.