Why is it that none of the big banks, chase etc, are giving out high interest rate savings accounts, where as new players or lesser know players or credit card firms are?
HSBC is not that big but they have high yield savings through HSBC direct
Hsbc and Citibank actually interest me. Reeasin being they are international, and one can open accounts in different countries and link them under one user id. And then making international money transfer is just about a few clicks
There are many reasons. One of them is that when you offer highest rates you tend to attract the most price sensitive customers. These are the guys that will run away first. So the volatile portion of the deposit balance increases. For the same liabilities you have lower core balance with long duration. The volatile balance has a very short duration. You can fund only the money market type of investments with it, hence net interest margin on these deposits is narrower.
Great explainations
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They have too many regulatory and physical operating costs to pay out higher. And interest rates are low in general so they would rather sell you some investment services...
I see, thanks