Matt Shanahan (Waterford, Independent)
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261. To ask the Minister for Finance if he can explain the reason the main banks are not paying any interest on deposit accounts held on behalf of ordinary citizens, despite the increase in revenue resulting from the higher interest rates being paid on these deposits by the European Central Bank; and if he will make a statement on the matter. [22371/23]

Brian Stanley (Laois-Offaly, Sinn Fein)
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262. To ask the Minister for Finance his views on the very low interest rate levels that retail banks are offering for deposit rates to customers; and if he will make a statement on the matter. [22560/23]

Brian Stanley (Laois-Offaly, Sinn Fein)
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263. To ask the Minister for Finance if his Department has spoken to the Central Bank or retail banks around increasing deposit interest rates for customers. [22561/23]

Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 261, 262 and 263 together.

Deposit interest rates are a means for banks to attract or maintain a stable source of funding. The determination of the rate of interest to offer to attract depositors is a commercial decision, which is the sole responsibility of the board and management of each bank.

Neither the Central Bank of Ireland nor I have a role in setting the interest rates offered by banks on monies held on deposit. Although the State is a shareholder in some of the banks operating in the jurisdiction, those entities must also be run on a commercial and independent basis, and their independence in this regard is protected by the relationship framework agreements.

In terms of the interest rates currently available on deposits, the European Central Bank (ECB) released March 2023 Euro Area Bank Interest Rate Statistics on 5 May 2023. The Central Bank of Ireland Retail interest rates release was released on 10 May 2023, and it can be accessed at: www.centralbank.ie/statistics/data-and-analysis/credit-and-banking-statistics/retail-interest-rates.

I am informed by the Central Bank of Ireland, that:

• Interest rates on household overnight deposits stood at 0.03 per cent in March 2023, while the euro area equivalent was 0.151 per cent.
• Interest rates on new household deposits with agreed maturity was 1.14 per cent in March in Ireland, while the euro area equivalent was 2.11 per cent.
• Interest rates on outstanding deposits’ rates with agreed maturity was 0.43 percent in March 2023 an annual increase of 34 basis points since March 2022. Interest rates on outstanding deposits’ rates with agreed maturity in theeuro area was 1.51 percent in March 2023.

It is worth noting that banks currently hold an unusually large share of overnight deposits by historical standards. This large share of monies held in overnight deposit reflects two factors:

• First, when interest rates were low (or negative up until July 2022), there was effectively little or no difference between the return on overnight versus term deposits for savers; and
• Second, much of the current build-up of deposits represents ‘passive’ pandemic savings – that is, savings that households built up when there were restrictions on economic activity and therefore reduced spendingopportunities during the pandemic.

Increasing competition to attract these relatively stable sources of funding could also contribute to a greater pass-through of policy rates into deposit rates over time.

The Deputies may also wish to note that the Competition and Consumer Protection Commission's (CCPC) website includes a number of comparison tools to help consumers shop around. These tools can be used to compare the features and rates of both lump sum deposit products and regular savings accounts.