This comes as savers continue to weigh up between the options of savings accounts and term deposits to store their cash after February’s RBA decision.
In its latest Statement of Monetary Policy (SOMP), the RBA detailed that depositors have looked to shift savings into term deposits throughout 2022 as the spread between new term deposit rates and at-call rates has increased.
“Rising term deposit pricing partly reflects banks seeking to take advantage of the favourable treatment in liquidity ratios of term deposits compared with at-call deposits,” the statement read.
“In addition, in an environment of rising interest rates depositors tend to demand a higher return for locking away funds for a period of time.”
These higher returns were offered this week by the likes of Bank of Queensland and Citi, with AMP taking the alternate route and cutting rates across a broad range of deposit products.
Bank of Queensland varies deposit rates by up to 2.00% p.a.
Bank of Queensland (BOQ) has increased term deposit rates in the past week by up to 125 basis points, as well as slashing rates by up to 200 basis points.
The largest increases were seen across BOQ’s 6-month Premier Investment deposits, lifting 125 basis points to 3.75% p.a.
At the same time, BOQ’s 7-month Premier Investment deposits were cut by 200 basis points to a rate of 1.50% p.a.
Both products require a minimum deposit amount of $5,000 with interest paid at the end of term.
Citi increases deposit rates by up to 0.40% p.a.
Citi has increased term deposit rates in the past week by up to 40 basis points.
This increase sees Citi increase its 6-month rate by 30 basis points to offer a rate of 3.90% p.a., while the bank’s 1-year rate has increased by 10 basis points to offer a rate of 4.20% p.a.
To achieve these rates, customers are required to deposit a minimum of $1,000 with interest paid at the end of term.
Rewind some two years ago, Citi was acquired by NAB in a reported $1.2 billion deal.
With NAB now closing a range of Citi-branded deposit and transaction products, these term deposits will only be available to customers who hold a transaction account prior to 20 May 2023.
AMP cuts term deposit rates by up to 0.20% p.a.
AMP has decreased term deposit rates across a broad range of deposit products with minimum deposit requirements ranging from $5,000 up to $1,000,000.
Key highlights of AMP’s term deposit decrease include a 10 basis point reduction to its 3, 4 and 5-year deposit rate requiring a minimum deposit of $5,000 to 3.95% p.a.
Alongside this change, AMP’s 5 and 7-month term deposit rates have decreased 20 basis points to 3.70% p.a., with a minimum deposit of $5,000 and interest paid at the end of term.
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Denise Raward
Harry O'Sullivan
William Jolly
