GERMANY German banks take their time before deciding to pass on European Central Bank (ECB) interest rate cuts to their customers, if at all.

Germany's big banks, Deutsche Bank, Commerzbank and Dresdner Bank, have yet to pass on last week's half-point rate cut.

Their policy has long angered Germany's consumer groups but has now attracted the attention of the Federal Cartel Office.

A few banks, such as Postbank and DiBa, a direct bank, will pass on the rate cut at the start of next month, something they trumpet on their websites and in advertising.

"I'm not surprised that the big banks are delaying, it fits into the general way they treat their customers. But customers are starting to notice," said Dr Ulrich Ott, spokesman for DiBa, which has seen its number of customers quadruple in the past three years.

Commerzbank spokesman Mr Peter Pietsch said it was "nonsense" to think banks should immediately pass on ECB rate cuts to its customers.

"That's a completely over-simplified argument I've been hearing for 15 years. Only a very small portion of our money sourcing is with the ECB and the rest of our business hasn't become any cheaper for us," he said.

Commerzbank leaves local managers room to manoeuvre on the exact level of their retail interest rates to allow them to compete better.

Mr Pietsch said it was likely that the ECB's decision of last week would be passed on to customers, in part or whole, "sooner rather than later".

"Low interest rates are a very important condition for economic stimulation but there is no guarantee of a stimulus effect," said Mr Pietsch.

He cites the example of the German construction industry, where interest levels are at their lowest level in 50 years, but still haven't manage to stimulate the sector.

Dresdner Bank passed on the interest cut immediately to its business customers and will reduce interest rates for private customers by up to 0.3 per cent in the coming days.

Deutsche Bank, Germany's largest financial institution, hasn't passed on last week's interest cut to its private customers, saying only that it was "watching the market".

A spokesman in Frankfurt said there was "no rule when or even if the interest rate cuts are passed on to customers".

Another spokesman said that with more than 2,500 German banks, margins had become so tight that it wasn't always possible to pass on the full interest rate cut to customers.

A similar opinion has landed Dr Rolf Breuer, former chairman of Deutsche Bank, in hot water with German authorities.

Dr Breuer, speaking last December as head of the German Banking Association, told journalists that banks "couldn't allow themselves" to always pass on ECB interest rate cuts.

"Cheek!" screamed the Bild tabloid the next day.

"Banks want to hold onto interest cuts," the Handelsblatt business daily wrote. "That policy means that the money infusions from the ECB are lacking in the German economy."

Mr Wolfgang Clement, the economics minister, said the remarks were "short-sighted" and didn't send "a good signal".

Mr Hans Eichel, the finance minister, said explicitly that banks should pass on cuts to customers, while some Social Democrat politicians have suggested legally obliging them to do so.

Dr Breuer's comments attracted the attention of officials in the Federal cartel office, the Kartellamt, which set up an investigation.

"For the head of such an organisation to recommend a certain type of behaviour for its members could be a clear breach of our Recommendation Law," said Ms Anja Scheidgen, spokeswoman of the Kartellamt, in Bonn.

She said the Kartellamt had received no complaints about German banks' interest rate policies and had no evidence of collusion on which to base an investigation of interest-rate fixing.

The investigation into Dr Breuer is ongoing, but the consequences for the former Deutsche Bank chief, if found guilty of breaking the law, are unclear.

German consumer groups are hoping to set up a targeted campaign against the banks they say are holding onto customer's money.

"Bank customers have a right that the banks pass on interest cuts," said Mr Rainer Metz, of the Consumer Association in the state of North Rhine-Westphalia. "We are looking for a bank customer to launch a test case against an institution."