Why Spuerkeess, BIL and BGL still aren't following the rates

The mechanism is supposed to be simple. When the ECB pays better for the reserves commercial banks deposit with it, those banks, in theory, pass part of that windfall to their depositors. That is what monetary-economics textbooks call the "pass-through" of policy rates. It is also what, in Luxembourg, only happens partially, slowly, and sometimes not at all.

The ECB deposit rate stayed around 3 to 4% for most of 2024–2025, before easing back toward 3.25% in early 2026. Meanwhile, Spuerkeess's historic passbook paid, on a weighted average, around 1.2%. Today, on the highest balances, it climbs to 2%. And you still have to be eligible for the upper tiers.

Adviser #1: "The structure of our balance sheet doesn't allow it"

First appointment, in a downtown branch. The adviser, courteous, explains that the bank is "structurally over-supplied with demand deposits". Translation: it has so much money dormant in current accounts — unremunerated — that it has no need to go and chase additional savings by remunerating its passbooks. The logic is unassailable from the bank's point of view. It is markedly less so from the point of view of the customer who funds, for free, that comfort.

I then ask the naive question: "But if I've been your customer for twenty years, isn't it a bit galling to be served 0.8% while you place my money yourselves at 3.25% in Frankfurt?" He smiles, nods, and changes the subject by inviting me to discover the Luxembourg life insurance that "better captures market yields". That was not the answer to my question.

Adviser #2: "The Luxembourg market is less competitive"

Second appointment, another bank, another district. The adviser, more direct, tells me that in Luxembourg, retail savings have, historically, been little disputed. Four big banks, a relatively loyal client base, switching costs perceived as high. As long as no one moves, no one has an interest in raising their rates first: it would be lost margin, with no obvious commercial gain. This is what economists call, with barely a veil, an implicit cartel equilibrium — except no one ever says it like that in a branch.

She adds, off the record: "Platforms like PickTheBank or Raisin will, eventually, force us to move. But we're not there yet. The volumes are marginal." Marginal? According to PickTheBank, more than €200 million were collected in 2025 from Luxembourg residents. That's not a wave. It is, for now, a trickle — but one that erodes.

Adviser #3: "Honestly, go elsewhere"

The third appointment is, by far, the most unexpected. The adviser, after answering my questions with the expected formulas, ends up telling me, almost in a low voice: "For a pure term deposit, you'll do better elsewhere. We're good on credit, on wealth management, on services to companies. On retail savings, frankly, we're not competitive."

That is probably the most honest sentence I've heard this year in a Luxembourg bank branch. It says a lot. It says that the advisers, internally, know it. It says that the specialisation of the big banks of the financial centre is happening, more and more, at the expense of the classic savings customer. And it suggests that the market — slowly but surely — is segmenting.

What to do, concretely?

Nothing spectacular. It's simply about separating two things that have long been conflated: the main banking relationship (current accounts, credit, wealth advice) and the yield of dormant savings. The former reasonably stays with a Luxembourg bank. The latter can, and probably should, go and seek the best rate available in the SEPA area, within the €100,000 guarantee limit per institution.

This is not an act of defiance toward the big Luxembourg banks. It's an act of financial common sense — exactly the one they would advise you, were you one of their large institutional clients.

Note: the interviews quoted took place between January and March 2026, privately, as a potential client. The remarks are reported from memory and reformulated; no adviser was named.