The Danish Central Bank had imposed a negative interest rate on deposits two years ago, although they abandoned it only after a few months. I don't know much of the details, but it was a failed experiment.
No it wasn't The move achieved it's target and there was no bank run and no pitchforks in the streets.
Impact on the foreign exchange market and capital inflows The most direct effect of lowering the deposit rate below zero was the depreciation of exchange rate, which reached the central parity shortly. Hence, the introduction of negative interest rates can be seen as a successful experience in the Danish case, which aimed at restoring the central parity of the EUR/DKK exchange rate. Also, the developments of foreign exchange reserves held by the central bank suggest that capital inflows have stopped from mid-2012 onwards
Full article:
http://www.mindfulmoney.co.uk/wp/shaun-richards/what-has-the-experience-of-denmark-taught-us-about-negative-interest-rates/And the conclusion:
Summary Overall, the negative deposit rate introduced by Danmarks Nationalbank in July 2012 was successful in limiting capital inflows and helped to push back the exchange rate of the Danish krone toward the central parity. Therefore, the adoption of the negative deposit rate was helpful in reaching the major objectives of its introduction. Moreover, while money market rates and treasury bill yields were already negative before the introduction of the negative DNB rate, after its introduction, these yields fell slightly further and yields on mortgage bonds also stabilised at a very low level. The evidence suggests that the rate cut did not lead to changes in retail interest rates, nor an increase in bank lending. With the normalisation of euro-area financial markets, the DNB could increase the deposit rate from -0.2 percent to -0.1 percent in January 2013 and to +0.05 percent in April 2014.
