Summary:
Term deposit rates were already well on the downturn but a wild week on financial markets has seen all four big banks take the knife to their rates. Commonwealth Bank of Australia followed the lead of its peers although ANZ’s focus was on business deposit rates this week. Of the big banks, ANZ, the smallest of the four, now offers the highest personal term deposit rate of 4.50% p.a. for eight months – although chances are that may not last too long.
New data from the Reserve Bank of Australia shows real returns (taking inflation into account) are now below zero on some deposit products. The figures show term deposit rates across all maturities averaged 3.20% p.a. in March, down from 3.25% p.a. in February. One-year deposit rates fell to 4.00% p.a. from 4.10% p.a. the previous month. Historically, banks have adjusted term deposit rates ahead of RBA moves to protect their net interest margins, so we may only be at the start of a downward trend in term deposit rates.
Notable weekly moves include:
- CBA joins the fray. CommBank joined Westpac in cutting its Special Offer rate by 30 basis points this week, while a swathe of its other rates also saw drops of between five and 30 basis points.
- Westpac group cut special offer rate. Westpac’s Special Offer 11 month term deposit rate for existing customers also took at 30 basis point hit. The new rate of 4.20% p.a. is for in-branch customers but those opening or renewing online can get 4.30% p.a., both with interest paid at maturity. The offer applies across the Westpac group: St George Bank, Bank of Melbourne, and BankSA.
- NAB cuts old top rate by 1%. National Australia Bank deposed its former top rate of 4.50% p.a. for eight months with a hefty 100 basis point cut this week. In its place, it’s installed a new top rate of 4.25% p.a., lifting its seven month rate by 75 basis points. It’s also shaved 10 basis points off a host of its shorter-term rates.
- Judo chops TD rates. The challenger bank is a fixture atop the best rates leader board but it’s sliced up to 40 basis points off its personal, business, and SMSF products this week. Judo slips out of top spot for with its new best offering of 4.80% p.a. for six months – a 10 basis point cut on the old market leading 4.90% p.a.
- Rabobank cuts up to 40 bp off longer-term rates. Rabobank is often among the top rate contenders and its best rate got a 10 basis point boost this week to 4.50% p.a. for six months. But it was all downhill from there, with its two and three year rates taking the biggest hits.
Other rate droppers:
- Bank of Queensland has cut up to 30 basis points from its Premier Investment term deposit rates, offering a best rate of 4.50% p.a. for six months, a 15 basis point drop.
- BoQ-owned ME Bank is offering a top rate of 4.60% p.a. for six months, also a 15 basis point drop.
- ING has adjusted its term deposit offerings, cutting some rates by up to 25 basis points. But its best rate – 4.50% p.a. for six months – has seen a 10 basis point lift.
- Bank of Sydney has trimmed five basis points from its still eye-catching top rate of 4.80% p.a. for six months. Its three month rate has also seen a 20 basis point cut to 4.60% p.a.
- Bank Australia has dropped term deposit rates by up to 25 basis points. Its best rate is now 4.60% p.a. for six months, a 10 basis point drop.
- MOVE Bank has gone the chop on its fixed term deposits, slashing its 12 month rate by 45 basis points to 4.05% p.a. Its best rate is 4.90% p.a. for four months, a five basis point drop.
- MyState Bank has taken up to 30 basis points off its online and regular term deposit rates. Its best rate is now 4.60% p.a. for six months (for both online and regular), a 15 basis point drop.
- Hume Bank has cut up to 30 basis points off a range its term deposit rates this week. Its new best rate is its special offer of 4.40% p.a. for a 100-day term.
- BCU Bank has taken up to 15 basis points off its standard, regular income, and 55 Plus Investment deposits. Its best new rate is 4.60% p.a. for five months.
- BankVic has cut 30 basis points from its 12 month Regular Income term deposit rates along with its 12 month (120) term deposit rate. Its new best rate is 4.45% p.a. for six months, a 25 basis point cut.
| Institution | 1 m nom | 2 m nom | 3 m nom | 4 m nom | 5 m nom | 6 m nom | 9 m nom | 1 Year | 2 Year | 3 Year | 4 Year | 5 Year |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ANZ | 1.25 | 1.45 | 3 | 3.15 | 3.25 | 3.4 | 3.6 | 4 | 3.75 | 3.1 | 3.1 | 3.1 |
| Commonwealth Bank | 1.25 | 1.5 | 2.90↓ | 3.10↓ | 3.15↓ | 3.20↓ | 3.40↓ | 3.40↓ | 3.75 | 3.5 | 3.5 | 3.5 |
| NAB | 1.25 | 1.45 | 3 | 3.05↓ | 3.15↓ | 3.30↓ | 3.50↓ | 4 | 3.8 | 2.9 | 2.9 | 2.9 |
| Westpac | 1.25 | 1.45 | 2.9 | 3.05 | 3.15 | 3.3 | 3.5 | 3.9 | 3.65 | 3.15 | 3.15 | 3.15 |
| Military Bank | 3.5 | 3.5 | 3.5 | 4.3 | 4.3 | 4.65 | 4.5 | 4.6 | ||||
| AMP Bank | 0.1 | 0.2 | 4.6 | 4.45 | 4.45 | 4.5 | 4.4 | 4.35 | 4 | 3 | 3 | 3 |
| Arab Bank Australia | 1.25 | 1.25 | 4.15 | 4 | 4 | 4.7 | 4.4 | 4.2 | 3.75 | 3.65 | 3.65 | 3.55 |
| Bank of Melbourne | 1.25 | 1.45 | 2.90↓ | 3.05↓ | 3.15↓ | 3.30↓ | 3.50↓ | 3.90↓ | 3.05↓ | 3.05↓ | 3.05↓ | 3.05↓ |
| Bank Australia | 4.45 | 4.60↓ | 4.30↓ | 4.30↓ | 4.10↓ | 3.90↓ | ||||||
| BankSA | 1.25 | 1.45 | 2.9 | 3.05 | 3.15 | 3.25 | 3.45 | 3.85 | 3.85 | 3 | 3 | 3 |
| Bankwest | 2 | 2 | 3.75 | 3 | 4.40↓ | 4.00↓ | 4 | 4.00↓ | 3.75↓ | 3.75↓ | 3.75↓ | 3.75↓ |
| Bank of Sydney | 1.25 | 1.5 | 3.25 | 3.5 | 3.5 | 4.4 | 3.7 | 4 | ||||
| BankVic | 3.6 | 4 | 3.7 | 4.45↓ | 3.7 | 4.20↓ | 4 | 4 | 4 | 4 | ||
| Beyond Bank | 4.55 | 4.4 | 4.25 | 4.2 | 3.7 | 3.6 | 3.6 | 3.6 | ||||
| Bendigo Bank | 1.25 | 1.5 | 3.2 | 3.7 | 3.8 | 4.1 | 4.2 | 4 | 3.25 | 3.3 | 3.3 | 3.3 |
| BOQ | 0.75 | 0.8 | 2.25 | 4.45↓ | 1.25 | 4.50↓ | 4.35↓ | 4.20↓ | 4.20↓ | 3.3 | 3.3 | |
| BOQ Specialist | 4.50↓ | 4.55↓ | 4.65↓ | 4.55↓ | 4.25↓ | 3.50↓ | 3.5 | 3.5 | 3.5 | |||
| Great Southern Bank | 1.3 | 1.6 | 4.5 | 4.8 | 4.5 | 4.7 | 4.4 | 4.4 | 3.8 | 3.6 | 3.6 | 3.6 |
| Defence Bank | 4 | 3.6 | 3.7 | 4.2 | 4 | |||||||
| Greater Bank | 1 | 1 | 4 | 4 | 4 | 4.65 | 4 | 4.45 | 4 | 4 | 4 | 4 |
| Heritage Bank | 1.25 | 1.5 | 3.95 | 4.65 | 3.6 | 4.45 | 4.35 | 4.25 | 4.1 | 3.9 | 3.9 | 3.9 |
| Horizon Credit Union | 1.25 | 1.5 | 3.7 | 3.7 | 4.1 | 4.5 | 4.3 | 3.7 | 3.6 | |||
| HSBC | 1.85 | 2 | 4.00↓ | 3.5 | 3.5 | 3.90↓ | 3.90↓ | 4.05↓ | 4 | 4 | 4 | 4 |
| IMB | 4.2 | 4.65 | 4.25 | 4 | 4 | 4 | 4 | |||||
| ING Direct | 4.25↓ | 4.25↓ | 4.50↑ | 4.30↓ | 4.05↓ | 3.80↓ | ||||||
| in1bank | 3.85 | 3.9 | 4.45 | 4.4 | 4.3 | 4.25 | 4.1 | 3.95 | 3.85 | |||
| Judo Bank | 4.75 | 4.80↓ | 4.65↓ | ↓ | 4.30↓ | 4.20↓ | 4.20↓ | 4.25↓ | ||||
| Macquarie Bank | 2.1 | 2.1 | 4.45↓ | 4.35↓ | 4.25↓ | 4.05↓ | 4.00↓ | 3.75↓ | 3.8 | 3.8 | 3.8 | |
| ME Bank | 0.75 | 0.8 | 2.25 | 4.45↓ | 4.50↓ | 4.60↓ | 2 | 2 | 2 | 2 | 2 | 2 |
| MyState Bank | 0.5 | 0.5 | 4 | 4.2 | 4.6 | 4.60↓ | 4.40↓ | 4.25↓ | 3.95 | |||
| Newcastle Permanent | 1 | 1 | 4 | 4 | 4 | 4.65 | 4 | 4.45 | 4 | 4 | 4 | 4 |
| People's Choice Credit Union | 1.5 | 3.95 | 4.65 | 3.6 | 4.45 | 4.35 | 4.25 | 4.1 | 3.9 | 3.9 | 3.9 | |
| Police Bank | 4.1 | 3.75 | 3 | 4.25 | 4.5 | 4.45 | ||||||
| P&N Bank | 1.6 | 3.90↓ | 3.90↓ | 4.60↓ | 4.30↓ | 4.3 | 3.50↓ | 3.50↓ | 3.45↓ | 3.45↓ | 3.45↓ | |
| RACQ Bank | 0.55 | 1.6 | 4.85 | 3.5 | 3.5 | 4.65 | 4.4 | 4.4 | 3.9 | 3.5 | 3.5 | 3.5 |
| Rabobank Australia | 2 | 2.1 | 4.55 | 4 | 4 | 4.50↑ | 4.20↓ | 3.95↓ | 3.70↓ | 3.80↓ | 4.15↓ | 4.30↓ |
| Rural Bank Limited | 1.25 | 1.5 | 3.2 | 3.7 | 3.8 | 4.1 | 4.2 | 4 | 3.25↓ | 3.30↑ | 3.3 | 3.3 |
| St.George Bank - Except VIC | 1.25 | 1.45 | 2.90↓ | 3.05↓ | 3.15↓ | 3.30↓ | 3.45↓ | 3.90↓ | 3.05↓ | 3.05↓ | 3.05↓ | 3.05↓ |
| Suncorp Bank | 1.3 | 1.9 | 3.95 | 4.55 | 3.45 | 4.7 | 4.25 | 4.3 | 3.75 | 3.75 | 3.75 | 3.75 |
| Teachers Mutual Bank | 4.55 | 4.3 | 4.35 | 4.5 | 4.45 | 4.35 | 3.9 | 3.9 | ||||
| The Capricornian | 3 | 3.25 | 4 | 4 | ||||||||
| Bank First | 0.75 | 1 | 4.45 | 4.45 | 4.6 | 4.45 | 4.4 | 4 | 3.8 | 3.8 | 3.8 |