Short tenures of less than 9-months have been all the rage recently, but this week took a turn; short term deposits largely saw rate cuts.
Nine months now seems to be about the sweet spot.
Let's get into the biggest movers and shakers for this week.
All interest on these products is paid at maturity unless otherwise noted.
Macquarie Bank makes modest adjustments
| Term | New % Rate p.a. (Change) | Deposit Size |
|---|---|---|
| 3 Months | 4.90% (-0.05) | $5,000-$1m |
| 3 Months | 4.85% (-0.05) | $1m-$10m |
| 12 Months | 4.85% (+0.05) | $5,000-$1m |
| 12 Months | 4.45% (+0.05) | $1m-$10m |
If you've got more than a million bucks in cash, Macquarie is one of the few banks to continue to offer fairly competitive rates.
Most other banks tap out at $2 million.
If you had $10 million and put it in the 12-month product you'd earn $445,000 before taxes.
Yes, that's right; assuming you earned no other income and had that $445k, that would look something like $265,000 accounting for the ATO's grubby mitts and the Medicare levy.
Bendigo Bank bets on short terms
| Term | New % Rate p.a. (Change) | Deposit Size |
|---|---|---|
| 4 Months | 4.00% (+0.40) | $5,000-$5m |
| 9 Months | 4.40% (+0.40) | |
| 12 Months | 4.50% (-0.15) |
A sizeable change on the shorter terms from Bendigo this week.
However, rates are still off the pace with the market leaders, with 5.00% p.a. or slightly higher on offer with a few banks, still.
Twelve-month products with varying interest payment schedules were also changed.
AMP joins the party
| Term | New % Rate p.a. (Change) | Deposit Size |
|---|---|---|
| 6 Months | 4.90% (+0.10) | $25k-$10m |
| 7 Months | 4.65% (-0.25) | |
| 12 Months | 4.90% (+0.15) | |
| 18 Months | 4.20% (-0.10) | |
| 2 Years | 4.20% (-0.05) | |
| 3 Years | 3.00% (-0.30) | |
| 4 Years | ||
| 5 Years |
AMP is back into the fray and making a statement with its 12-month rate.
Apart from that, its longer-term rates are sharply off the pace.
Adding to that, these rates are for deposit sizes of $25,000 or more; lower rates apply if you have less than that.
Terms less than 12-months have interest paid at maturity while longer terms have interest paid annually.
Other movers
- Bank of Us boosted 9-month rate by 15 basis points but slashed 12-month rates by the same margin.
- Bank of Sydney varied rates by up to 60 basis points.
- Teachers Mutual and subsidiaries cut rates on 6- and 12-month terms by 10 and 15 basis points respectively.
- Bank Australia took 10 basis points off its 6-month product.
- Geelong Bank cut 12-month rates by 20 basis points.
Photo by Alfred Kenneally on Unsplash
