Nooshi hits out at the government over greedy banks: “At the slightest excuse, they rocket interest rates”

After several major Swedish banks recently raised their variable mortgage rates – even though the Riksbank has not changed the policy rate – criticism is growing against both the banks and the government. Politicians are now calling for concrete measures to push interest rates back down. According to the Left Party leader Nooshi Dadgostar, the government is giving the major banks free rein to empty Swedish households of money by hiking rates at the slightest excuse.

The ongoing war in the Middle East – where the US and Israel are at war with Iran, while Iran, among other things, attacks the oil industry in and around the Persian Gulf – has triggered a severe :censored:6:cdd6bbaa89: energy price shock with clear effects on both commodity markets and the broader economy. Analysts have warned that developments could have far-reaching consequences.

In addition to both the EU and the government signaling fuel rationing, there is also news that the banks are raising their variable interest rates.

Finance Minister Elisabeth Svantesson (M) has herself reacted to the development and describes the banks’ actions in strong terms. On social media, she writes that the hikes “put additional pressure on Swedish people’s finances” and continues:

“They do this despite large profits and the fact that the Riksbank has not raised the policy rate. It is nothing short of out of touch with reality.”

Left Party leader wants tougher line against banks

At the same time, the finance minister is urging households to switch banks if they are dissatisfied – an approach sharply criticized by the Left Party leader Nooshi Dadgostar. She believes that the Tidö government is in practice siding with the banks’ “greed” on this issue.

Instead, she wants the government to side with families. According to Dadgostar, by only offering advice that doesn’t work, the government has in practice given the banks the green light to raise interest rates at the slightest excuse. She even goes so far as to describe it as the banks stealing from households.

The background is that basically all major banks have recently raised their variable mortgage rates by 0.15 percent, after a period of reductions following several years of increases, partly driven by rising inflation and economic uncertainty in the wake of Russia’s invasion of Ukraine. According to Dadgostar, there are no valid reasons for this latest hike.

The Left Party leader also dismisses the argument that the banks are only raising rates to cover future costs. According to Dadgostar, the banks are rather exploiting the situation without real grounds and points out that everyone knows the banking market is not functioning as it should at the moment.

– It’s greedy. At the slightest excuse, they rocket interest rates. That’s why they’ve had such high profits until now, and we see it again. They take the opportunity to cash in at the expense of households, she tells Aftonbladet.

Dadgostar wants the state-owned bank SBAB to press the market, so the other banks cannot act in the same way.

– We have a state bank, SBAB, and they must be tasked with pressing down the rates. It’s a simple tool, and the government can use it now. If they do so, it would lower rates for the entire market, as it would force other banks to lower them, the Left Party leader tells Aftonbladet.

The criticism is not just about mortgage rates. Dadgostar also points out that savings rates have not increased to the same extent, something also questioned earlier by Riksbank chief Erik Thedéen.

The Left Party notes that the finance minister’s statements on social media are empty words towards the big banks. At the same time, Svantesson emphasizes in her response that the state should not intervene and that banks should be free to act according to market conditions – where politicians should not generally set the price of goods or money.