This week saw big moves to term deposit rates.
Three more banks joined Community First and Judo Bank in offering 4.50% p.a. returns on one year term deposit accounts, including Bank First, which now offers a market leading 4.55% p.a.
Bank First increases rates by up to 80 basis points
| Deposit size | Payment frequency | Interest rate per annum (Percentage point increase) | |
| Six month | $500-$19,999.99 | End of term | 4.30% (0.3) |
| Six month | $20,000-$49,999.99 | End of term | 4.30% (0.3) |
| Six month | $50,000-$99,999.99 | End of term | 4.30% (0.3) |
| One year | $500-$19,999.99 | End of term | 4.55% (0.3) |
| One year | $20,000-$49,999.99 | End of term | 4.55% (0.3) |
| One year | $50,000-$99,999.99 | End of term | 4.55% (0.3) |
Australia has a new market leader for 12-month term deposit accounts.
Victoria's Bank First has announced its range of twelve month term deposit products, ranging from $500 to $100,000, will all return 4.55% p.a., surpassing Judo Bank, Community First and AMP (4.50% p.a.).
Its six month terms also yield among the highest returns in Australia, at 4.30% p.a.
NAB increases rates by up to 110 basis points
| Deposit size | Payment frequency | Interest rate (Percentage point increase) | |
| Six month | $5,000-$1,999,999 | End of term | 3.55% p.a (1) |
| One year | $5,000-$1,999,999 | End of term | 4.20% p.a (0.2) |
| One year | $5,000-$1,999,999 | Semi annually/Quarterly | 4.15% p.a (0.2) |
| One year | $5,000-$1,999,999 | Monthly | 4.10% p.a (0.15) |
NAB were the first of the big four banks to make term deposit moves since March's monetary policy decision, hiking up term deposit rates by up to 1.10% p.a.
Six month accounts are up by 100 basis points, but remain some way off the market leaders who offer returns well over 4% p.a.
Many of NAB's terms saw significant moves, but it was the 5 month term that received the biggest boost, up by 110 basis points to now return 3.25% p.a.
Just before the RBA announcement, CBA announced similarly large increases to its shorter term deposit products, suggesting the big four are looking to bridge the gap to the returns of well over 4% p.a available at smaller providers like Judo Bank and Bank First.
ING increases rates by up to 30 basis points
| Deposit size | Payment frequency | Interest rate (Percentage point increase) | |
| Six month | $10,000-$5,000,000 | End of term | 4.10% p.a (0.15) |
| One year | $10,000-$5,000,000 | End of term | 4.40% p.a (0.25) |
| Two year | $10,000-$5,000,000 | Annually |
4.40% p.a (0.25) |
With a 4.40% p.a return on one year term deposit accounts, ING is hot on the heels of Bank First.
ING also made headlines this week for boosting the highest return on its Savings Maximiser amount to 5% p.a, only the second provider in Australia to do so (after BOQ).
Their six month term deposit account is also now above the 4% p.a mark.
ME increases rates by up to 75 basis points
| Deposit size | Payment frequency | Interest rate (Percentage point increase) | |
| One year | $5,000-$2,000,000 | End of term | 4.45% p.a (0.1) |
| One year | $5,000-$2,000,000 | Monthly | 4.45% p.a (0.75) |
ME is another bank vying for the highest returns on one year term deposits, with rates now up to 4.45% p.a.
Interestingly, this includes its product paying monthly interest, where rates were hiked up by 75 basis points.
In another unusual move, it increased rates on its nine month term by 30 basis points to 4.50% p.a.
This is not only another market leader, but ME customers can now earn better returns (on a per annum basis) depositing their money for nine months rather than a year.
AMP increases rates by up to 35 basis points
| Deposit size | Payment frequency | Interest rate (Percentage point increase) | |
| Six month | $5,000-$24,999.99 | End of term | 4.20% p.a (0.1) |
| Six month | $25,000-$99,999.99 | End of term | 4.25% p.a (0.1) |
| One year | $5,000-$24,999.99 | End of term | 4.45% p.a (0.35) |
| One year | $5,000-$24,999.99 | Monthly | 4.25% p.a (0.2) |
| One year | $25,000-$99,999.99 | End of term | 4.50% p.a (0.2) |
| One year | $25,000-$99,999.99 | Monthly | 4.30% p.a (0.2) |
AMP this week moved level with the previous market leaders for 12 month term deposits of over $25,000, with a 4.50% p.a return.
For smaller deposits, it remains slightly behind the likes of Judo and Bank First, where these rates extend to deposits as little as $1,000.
This latest round of increases means AMP's entire range of term deposit products return more than 4% p.a.
G&C increases rates by up to 35 basis points
| Deposit size | Payment frequency | Interest rate (Percentage point increase) | |
| Six month | $1,000-$99,999,999.99 | End of term | 4.20% p.a (0.2) |
| Six month | $1,000-$99,999,999.99 | Monthly | 4.15% p.a (0.2) |
| One year | $1,000-$99,999,999.99 | End of term | 4.50% p.a (0.1) |
| One year | $1,000-$99,999,999.99 | Monthly | 4.45% p.a (0.1) |
There are now four providers offering 4.50% one year term deposit rates (G&C, AMP, Judo Bank and Community First).
Unlike AMP though, G&C will apply this rate to all deposit sizes, from $1,000 to $100,000,000.
ANZ increase rates by up to 135 basis points on its Advance notice products
| Deposit size | Payment frequency | Interest rate (Percentage point increase) | |
| Five-Six months | $5,000-$99,999.99 | End of term | 3.50% p.a (1.35) |
| Six-Seven months | $5,000-$99,999.99 | End of term | 3.55% p.a (1) |
| Six-Seven months | $5,000-$99,999.99 | Quarterly | 3.53% p.a (0.99) |
| Twelve-Eighteen months | $5,000-$99,999.99 | End of term | 4.40% p.a (0.3) |
| Twelve-Eighteen months | $5,000-$99,999.99 | Quarterly | 4.33% p.a (0.29) |
ANZ was the other of the big four to move term deposit rates this week, adjusting its range of Advance notice products.
ANZ allows customers to earn a higher interest rate, on the condition that at least 31 days' notice is given if funds are to be withdrawn early.
ANZ has the highest return for one year terms of the big four, with a 4.40% yield, according to Savings.com.au market research.
These latest moves also mean single year terms at ANZ will earn significantly more than multiple years, with 24, 36 and 48 month terms sitting at 4.05% p.a.
ANZ economists expect the cash rate to reach 4.10%, and remain high until cuts begin in mid 2024, bring rates to 3.85% p.a by November.
Other movers
- Australian Unity increased term deposit rates by up to 20 basis points
- Macquarie increased rates by 5 basis points
- My State increased rates by up to 80 basis points
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Want to earn a fixed interest rate on your cash? The table below features term deposits with some of the highest interest rates on the market for a six-month term.
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Denise Raward
Harry O'Sullivan
William Jolly
