Swedish central bank governor criticises major banks for failing to raise savings rates

The governor of Sweden’s central bank has accused the country’s largest banks of inconsistency after they raised mortgage rates but failed to increase savings rates for customers, reports SVT Nyheter.

Erik Thedéen, head of the Riksbank, said the banks’ justification “does not add up” and called for “a bit of order” in how they apply interest rate adjustments. Major lenders including Swedbank, Nordea, SBAB, and SEB have increased variable mortgage rates, citing rising market rates linked to global uncertainty, such as the conflict in Iran. However, they have not passed on equivalent rises to savings account holders.

“One moment they say they follow market rates, and the next they forget to do the other part. There needs to be some consistency here,” Thedéen told SVT’s 30 Minuter programme. When asked if savings rates should also rise, he replied: “Absolutely.”

Thedéen acknowledged “a certain logic” in the banks’ argument that their funding costs are affected by expectations of future rate hikes. But he highlighted a clear imbalance: “The problem with this logic is that it apparently does not apply to deposit rates on savings accounts.” While mortgage rates quickly rise with market rates, standard salary accounts often remain at very low levels.

“They make up for it at the other end and maximise their margins,” he said. “They are profit-maximising—that’s not strange in itself. But it’s hardly something that strengthens trust in the banks.”