Hansapank changes interest calculation

TALLINN - Hansapank made some changes to the calculation of interest revenue, which is more favorable to the bank as well as the smaller clients of Hansapank.

According to the new order, Hansapank pays one-percent interest revenue a year on the average balance of the monthly account since July 1. Until the changes went into force, Hansapank paid 3 percent on the minimum balance of the account per month, if the sum exceeded 1000 kroons ($ 67).

Interest revenue is paid out once in a quarter. With the changes in the interest calculation, Hansapank starts paying out interest on all sums of money, which according to Raul Parusk, head of the retail department of Hansapank, is good news for most of the clients of Hansapank.

"Seventy percent of our clients did not receive interest when the minimum level was 1000 kroons. Those clients, who spent most of their payroll bank account win from the new order and those, who did not spend their money much and had a high minimum level on the account, will lose with the new changes," said Parusk.

Hansapank will definitely win from the new rules, as the 3 percent rate from the minimum balance is actually equal to 1.49 percent from the average balance. Parusk said that Hansapank had to decrease the interest rate level due to the general decrease of interest levels in Estonia.

Interest rates have decreased substantially in Estonia during the last year. The interest rate for a term deposit in Hansapank has decreased from 13 percent in autumn to 7 percent. Interest on loan has decreased from 17 percent to 12 percent during the same period, said Parusk.

Uhispank, second biggest bank after Hansapank, has the same interest calculation system as Hansapank had before the changes on July 1.