Finance company UDC, which is owned by ANZ, has hiked some of its longer term deposit rates, while Fisher and Paykel Finance has hiked rates across the board as the latest round of deposit rates rises continues. UDC raised its two year deposit rates by 25 basis points (bps) to 5.75%; and its three year rates by 25 bps to 6.25%. It also raised its five year rate for the NZ$5,000 tier by 15 bps to 7.05% and for the NZ$100,000 tier by 15 bps to 7.15%. The rates are sitting above ANZ's respective rates by between 30 and 50 bps. Fisher and Paykel Finance raised deposit rates across the board by between 25 and 100 basis points. Fisher and Paykel Finance is covered by the government's deposit guarantee which ends on October 12, 2010. See all deposit rates for terms less than one year here, and for terms one year and greater here. Deposit rates are rising as competition increases between institutions for local deposits. Banks have been ramping up their share of the local deposit market following new guidelines from the Reserve Bank that they raise more funds locally and for longer terms. This has put pressure on the non-bank sector, which funds itself from local 'Mum and Dad' depositors, to also increase interest rates to attract funds.
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