Bank of England: Companies losing billions to UK Banks
May statistical release from the Bank of England shows the continuing ‘spread’ (net interest margin) cost for companies.
Corporate Benchmarks from Bankhawk confirms that the return on company and institutional funds in UK banks continues to lag the changes in market interest rates.
Companies should carry out a review of their banking arrangements to determine if their own net interest margin is optimised.
Bankhawk’s experience is that companies can improve profitability without having to make significant changes to their banking structure.
CFO’s and corporate treasurers are working with Bankhawk to effect improvements to the structure and configuration of the banking arrangements using benchmarking and deep banking expertise.
Source: Bank of England March Statistics
PNFCs deposits and loans
A PNFC is a private non-financial corporation.
Effective interest rates for: PNFC’s on stock outstanding of deposits and loans
1. The effective rate for sight deposits increased by 0.07% from 1.63% in February to 1.70% in March.
2. The effective rate for time deposits increased by 0.17% from 3.17% in February to 3.34% in March.
3. The effective rate for loans increased by 0.14% from 5.65% in February to 5.79% in March.
Effective interest rates for: PNFC’s on new deposits and loans
1. The effective rate for time deposits increased by 0.11% from 3.43% in February to 3.54% in March.
2. The effective rate for loans remained stable in March.
Table: Effective Interest Rates paid/received on PNFC balances by UK MFI’s (excluding Central Bank)
Per cent – Not seasonally adjusted