Do You Allow Your Bank To Take Advantage Of You?

Is your bank ripping you off?

Actually, scrap that, the question should be, are you letting your bank rip you off?

We all know that banks and building societies like to pass on rate hikes in a more timely and complete manner to borrowers than they do to savers.

Yet, as interest rates have been picked up off the floor and launched into the sky over the past year, Britain’s major banks have been thoroughly gratifying themselves.

Analysis by This is Money showed the magnitude of this last week when number crunching of Britain’s Big Five banks’ annual results revealed they raked in an additional £7 billion from broadening net interest margins.

Net interest margin is a fundamental banking industry figure, calculating the gap between what borrowers are charged and what savers are paid.

The greater the number, the better the spread, and the more returns for the bank.

Figures revealed the full scale of how Barclays, NatWest, Lloyds, HSBC and Santander made additional money by passing on more of the Bank of England’s interest rate hikes to borrowers than savers.

In total, the banks scooped a tidy £39.9 billion in total from the gap between savers and borrowers, and this is how much each bank made on net interest margins.

Of course, you would expect banks to make some money on this. A banking industry with no or very low net interest margins isn’t going to be a particularly stable one, and we all have long enough memories

Of course, you would expect banks to make some money on this. A banking industry with no or very low net interest margins is not going to be a particularly stable one – and we all have long enough memories to remember why we like banks and building societies to have a healthy degree of stability.

Nonetheless, the Big Five clocking up an additional £7 billion means that they made a chunky 21 per cent more from net interest margins than they did the year before.

And don’t forget, the analysis only looked at the figures from the big banks, the real cost to savers once you count in the rest of the banks and big and small building societies would be far greater.

You’d like to believe that after years of rock bottom rates, and a recent history of such illustrious insult accounts as the 0.1 or even 0.01 per cent savings rate, banks would endeavour to offer savers a better deal as the base rate finally began to rise.

Energy companies make billions. Banks make billions. Supermarkets make record profits. Yet there’s never enough money for reasonable salaries, and we’ve got a Government that constantly fails the people and provides no defence against silly price hikes, and all that banks are – are gangsters in suits. Along with pharmaceutical companies, energy goliaths and politicians who all work hand in hand to steal from us legally.

And now they’re trying to close banks so it’s impossible to get cash and then when you use your credit or debit cards to pay for something they then deduct a percentage from the already struggling businesses who are receiving your payments. So, they’re making money over fist because they no longer have to pay for the upkeep of their branches or pay workers, and then as soon as interest rates rise they raise mortgage fees. So, you’d really expect them to pass some of that bounty onto their customers.

Never in the field of finance have so many been shafted by so few.