IWBank is launching a new promotion for IWPower: 6% interest rate, until January 31st 2008. But only if total deposit raising will be at least 2 billion Euros. If this sum won’t be reached, the applied interest rate will be a more modest, but appreciable, 4,50% (that is anyway a promotional rate: from February 2008 the intrest rate will be 4,00%).
This is a quite unique promotion, personally I don’t remember any other promotion based on the total fund raising, and I’m curious to see how it will end. In my opinion it won’t be so easy to reach this objective, since are computed only deposits at-sight, excluding REPOs-liks IWPower 30-90-180.
The real novelty is another, and maybe much more significant:
- IWPower is now a savings account opened to everybody, and not just to IWBank customers. And it can be expected that it will erode a significant part of the customer base from ING Direct’s Conto Arancio and Santander (since they offere respectively a 3,00% and 3,75% interest rate).
- IWPower 30/90/180 now, in case of anticipated withdrawal, remunerates the deposited sum at the at-sight IWPower rate (formerly withdrawal was possible, but there were no interests). This mean that ING Direct and Santander will have to modernize their Conto Arancio+ and Time Deposit, that lock up capital for excessive long time.
In conclusion, i think these news from IWPower are good news, since it shows an increase in competition in the savings acocunt market, from which can benefit everyone, not only IWBank customers.
Original post (in Italian): IWPower al 6%! Ma solo se…
Banche e Risparmio [http://www.banknoise.com]