Danish bank announces negative interest rates for millionaire saving accounts

A Danish bank has announced it will begin charging millionaires a fee to store their money.

Jyske Bank will impose a negative interest rate of 0.6 per cent for clients who deposit more than 7.5m Danish kroner (£916,000).

In effect, it means millionaires will lose money to the bank every year.

The bank, the country’s second-largest lender, will introduce the negative rate on 1 December later this year.

Anders Dam, chief executive of Jyske Bank, said: “The negative interest rate environment has characterised the Danish market almost continuously for seven years. We have always believed that the negative interest rates were temporary. It now turns out to be more permanent.”

Mr Dam went on to say that there is an expectation there will be negative interest rates “over the next eight years”.

He said the bank’s profits from its private customers deposits had suffered a “large deficit” which was increasing as customers continued to deposit more money.

“Therefore, we intervened and set an upper limit of 7.5m Danish kroner,” he explained.

Denmark became one of the first countries to introduce negative rates in 2012.

Earlier this month, Jyske Bank became the first to offer a negative interest rate mortgage, effectively allowing customers to pay 0.5 per cent less to borrow money for 10 years.