11% AER Deposits for One Month: The 2008 Banking War

Deposits at 11% AER for one month: when banks paid for your money

There was a time when a bank offered you 12% AER for holding your savings. For one month. And with a minimum of 100,000 euros. Between late 2007 and early 2008, Spanish banks waged a silent war to attract funding through promotions, and some forum users devised a satellite account system to jump from offer to offer. The recipe circulating was simple: a base account earning 3% at sight and a string of disposable accounts at 7% or 8%.

From Sight Account to 11% AER Deposit

The catalog that winter was a historical anomaly. On January 26, 2008, Bankinter launched a 1-month deposit at 11% AER, available for between 3,000 and 30,000 euros, with a second version at 12% AER reserved for those depositing 100,000 euros. A month earlier, ING Direct had announced that its Orange Account would rise to 4.50% AER from January 1, though only for new customers and for balance increases for existing ones. The Balearic savings bank Sa Nostra applied December's Euribor to its Direct Savings Account, setting it at 4.80% AER, above the October peak. IberCaja made a move with its 9-month Welcome Deposit at 5.10%, and uno-e maintained its 15 Deposit at 6.41% AER, with 15% in the first month and weekly Euribor thereafter.

The Satellite Account Engineering

The logic was to exploit the acquisition promotions one by one. The proposed structure chained a reference interest-bearing account at 3% sight with up to four auxiliary accounts: ING Direct at 7% for one month, Openbank at 8% for another month, and Bankinter at 7% with a cap of 30,000 euros. The final link was to take advantage of Santander's branch openings, which often offered special conditions to new branch customers. The drawback, pointed out by more than one, is that Openbank and Bankinter's star products only accept funds from new customers. They are a one-time offer.

On paper, jumping from one promotion to another seems free. In practice, it requires opening and closing accounts, moving transfers, and monitoring expiry dates. The precise calculation of actual gains from these jumps—and what is lost along the way—is what separates those who profit from their funds from those who just make noise.

The Fine Print That Eats the Interest

Bankinter's 11% AER came to nothing for those who read the second page. The entity charged 15 euros annually for account maintenance, capped at 45 euros, an amount one participant considered unacceptable for someone merely seeking to safeguard their money. Being charged for the custody of one's own money sounded, at best, like a rip-off.

There were other catches. The uno-e Deposit 15 renewed automatically every six months unless otherwise instructed, which some saw as a trap due to the difficulty of proving they had requested otherwise. Others countered that such an order is as valid as any transfer or password change. The conclusion drawn by one participant: money should either be kept liquid or in a deposit with a specific term and a clear redemption date.

Home Purchase Account: 9,015 euros and 15% tax relief

The other major draw was fiscal. The home purchase account allowed deducting 15% of annual contributions deposited by December 31, up to a limit of 9,015 euros. The recurring question was whether the money could be moved during the year and returned just before year-end. The majority answer: it could only be transferred to another account or deposit designated as a home purchase account, and investment funds were excluded. Withdrawing it for stock market investment was seen as speculating with a bonus intended for buying property, and some participants called it outright illegal.

The temptation was clear: open the account on December 31, deposit the maximum, and claim the tax deduction for that year. The problem arises the trinc year, when the balance needs to be reconciled again.

When Banking Gave Way to Telecoms

Halfway through, the conversation drifted away from the original topic. Half a dozen posts turned to internet service providers and the trials of sign-ups, cancellations, and phantom bills. Jazztel bore the brunt, with accounts of months without service and impossible invoices; there were also satisfied customers and contrary examples with Wanadoo or Tele2. The sarracena dropped by an annoyed participant was the usual one: while people are fighting over the current company, taxes and loans continue their course.

The deposit war depended entirely on a high Euribor and the banks' fierce need for funding. As long as both conditions held, jumping from one promotion to another made sense. When they change—and sooner or later they do—the 11% will remain as a snapshot of a winter that no one expected to repeat. No one knew back then how long it would last.