Some non-Premier account holders of HSBC are upset over the bank's plan to lift its 50 per cent preferential rate to rent a safe deposit box.
This means a 100 per cent hike for such customers in the annual rental fee which for the largest box works out to S$856 inclusive of Goods and Services Tax.
Premier account holders are those who have at least S$200,000 with the bank or a minimum S$800,000 property loan.
"It's ridiculous . . . we all know safe deposit boxes are in short supply," an HSBC customer told BT.
Moreover, unhappy customers are unlikely to switch to other banks because bank safe deposit boxes, especially those located in a central location such as HSBC's Claymore branch, have become increasingly rare.
In fact, in HSBC's case new safe deposit boxes are available only to Premier customers, though even for them there's a waiting list.
Another sore point for many HSBC customers who have been with the bank for decades is that the boxes were taken up when they were not Premier account holders.
So even if they have since become Premier customers, the Premier account may not be in the same name as their safe deposit boxes.
For instance, one customer rented the box when she was single. Her current Premier account is a joint account with her husband.
HSBC said in a letter: "To continue enjoying the preferential rates for your safe deposit locker, it's important that you sign up for an HSBC Premier account in the same names(s) as the lessee of the safe deposit locker."
In another case, the customer's box is jointly held with her mother but they have separate Premier accounts.
"It's a legacy thing . . . they are so inflexible," said the customer.
When contacted, a bank spokeswoman said "HSBC reviews the fees of our products and service offerings on a periodic basis".
Meanwhile, Standard Chartered Bank practises a similar policy where Priority customers - those with at least S$200,000 deposit or a S$1.5 million minimum in housing loans - enjoy a 50 per cent fee waiver.
"The waiver on safe deposit fees for our Priority customers has been in place for a long time, since more than a decade ago," said a StanChart spokeswoman.
There are non-bank companies which provide safe deposit services.
But banks are generally preferred by customers who regard them as being safer because they are regulated by the Monetary Authority of Singapore.
However, over the years banks have reduced the number of boxes available because of the high cost of real estate in Singapore and so typically new branches do not offer such boxes.
For example, a 2007 Straits Times article said the cost to a bank of building and maintaining a secure vault with about 3,000 boxes of various sizes could easily add up to S$1 million.
Local banks charge lower rental fees for their safe deposit boxes, though wealthier customers also enjoy preferential treatment.
OCBC Premier customers have five branches to choose from to rent safe deposit boxes with rental fees of between S$182 and S$561.
They also enjoy a preferential rental rate of 20 per cent off, said Jean Oh, OCBC head of branch service and risk management.
Non-Premier customers pay full price and are limited to safe deposit boxes at two branches.
Over at United Overseas Bank (UOB), mass retail customers need to place a deposit of S$10,000 to maintain a safe deposit box.
Rental rates range between S$200 and S$520, and there's limited availability of boxes at five branches, said a UOB bank spokeswoman.
DBS Bank is the most equitable with no preferential rates for its well-heeled customers.
But no boxes are available, a spokesman said.
"All our safe deposit boxes are fully taken up and we have some customers on waitlist."
This article was first published on January 31, 2017.
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