Unlocking Higher Deposit Returns: Looking Beyond Traditional Irish Banks

“Returns on Deposit Funds … can generate between 3-4% per annum whilst also being accessible, if needed, in the short term’’

As financial planners, we are one of the few businesses where early January does not bring the customary blues, but instead an energy amongst the team as we return to our offices. January is a month of new beginnings for people when plans for nutrition, fitness, finance as well as numerous other “resolutions” begin in earnest.

It’s also one of Metis Ireland’s busiest times of the year as our clients and their families set their stall out for 2024. This time last year we had a significant change in PRSA funding legislation which became a very tax-efficient option for business owners in terms of building pension values for the next phase of their journey and this year again there is a new (ish) development which provides further opportunities for families and their businesses.

Throughout 2022 & 2023 interest rates globally have steadily risen to try and ease the rise in inflation across the EU, UK & US. For the best part of two decades, deposit funds have offered little to no return for investors who wished to generate some sort of short-term return on surplus cash either personally or through their companies. That has changed significantly over the past 18 months with Money Market (deposit) funds becoming attractive again for investors looking to make their money work for them. It’s true that the Irish Banks have yet to play ball in passing on the interest rate rises to customers in an attractive sense but that does not mean there are not plenty of options for people looking to avail of low-risk returns.

Irish families saved over €4bn in 2023, one of the highest savings rates in the EU, with over €2.5bn of that directed towards deposit funds*. This option is particularly attractive for businesses with surplus cash on their balance sheet as returns on deposit funds available with alternate providers in the Irish market can generate between 3-4% per annum* whilst also being accessible, if needed, in the short term which is a major plus for company investments. At Metis Ireland we very much adopt a long-term view to investing for our clients and that evidence-based approach to investing still remains the core of our proposition but for the first time in a long time, deposit funds offer the opportunity for return for shorter-term investors and it’s something families and businesses alike should be looking to explore in 2024.

So, if you are one of those people who have left your money on deposit in the Irish Banks getting no return, this January get yourself in financial shape and give us a call. We can guide you through the best options available for you and maybe it will lead to an enduring relationship with Metis Ireland that brings you and your family closer to your long-term goals through our Metis LifePlan.

*December 2023 report from German bank Raisin and the OECD

*3.92% Current yield of JP Morgan Standard Euro Money Market Fund (Jan 2024)

If you’d like to find out more, please don’t hesitate to give us a call on 01 908 1500 or email us at info@metisireland.ie.

Paddy Andrews CFP® QFA

Private Client Manager