ASB has cut its term deposit rates for terms of one year and longer.
It now offers some of the lowest term deposit rates of any bank, as it is awash in funds and it focusses of being price competitive in the hot mortagge market.
It has cut its one year rate by 20 bps to 4.00% from 4.20%.
Its eighteen month TD rate falls by 15 bps to 4.10% from 4.25%.
The biggest cust come for two and three year terms where the reduction is 35 bps. The two year TD rate falls to 4.15% from 4.50% and the three year rate falls to 4.40% from 4.75%.
Smaller reductions apply for four years where the rate falls 15 bps to 4.75% from 4.90%. The five year rate drops 10 bps to 5.00% from 5.10%.
These changes increase the rate curve. The difference between the one year rate is now a full 1.00%, steepening it from the previous 0.90%.
ASB sorter rates are unchanged, with its 6 and 9 month rates staying at 4.00%. This 4.00% rate now applies for all terms 6 to 12 months.
Term PIE rates have received the same reductions, but switching to one of these funds may enable you to claw back some of the reduction with a lower tax payable. This table will show the equivalent pre-tax rates for comparison.
These same changes apply for sister insitution, BankDirect.
In contrast, the highest main-bank rate for a one year term deposit is 4.30% which is still offered by BNZ, Kiwibank, and Westpac.
Among the smaller banks, RaboDirect still offers 4.50%.
You can find a comprehensive list of all term deposit rates here » and here »
Because interest crediting terms vary between insitutions, your actual after tax return can vary depending on the frequency you need interest paid. Check our tables for those details, and use this handy calculator to work out the actual effect for you.
| as at Saturday, Sept 8, 2012 for $10,000 | 6 mths | 1 yr | 2 yrs | 3 yrs | 4 yrs | 5 yrs |
| Main banks | ||||||
| ANZ | 4.00 | 4.00 | 4.25 | 4.50 | 4.75 | 5.00 |
| ASB | 4.00 | 4.00 | 4.15 | 4.40 | 4.75 | 5.00 |
| BNZ | 3.60 | 4.30 | 4.50 | 4.75 | 5.00 | 5.25 |
| Kiwibank | 4.00 | 4.30 | 4.50 | 4.75 | 5.00 | 5.25 |
| National Bank | 4.00 | 4.00 | 4.25 | 4.50 | 4.75 | 5.00 |
| Westpac | 4.25 | 4.30 | 4.60 | 4.75 | 5.00 | 5.25 |
| Second tier banks | ||||||
| HSBC | 4.00 | 4.15 | 4.40 | 4.65 | 4.90 | 5.15 |
| RaboDirect | 4.30 | 4.50 | 4.75 | 5.00 | 5.25 | 5.55 |
| SBS / HBS | 4.30 | 4.40 | 4.70 | 5.00 | ||
| The Co-operative Bank | 4.20 | 4.35 | 4.60 | 4.80 | 5.10 | |
| TSB Bank | 4.15 | 4.30 | 4.50 | 5.00 | 5.25 | 5.50 |
| Other banks | ||||||
| Bank of Baroba | 4.25 | 4.60 | 4.75 | 5.00 | ||
| Bank of India | 4.25 | 4.60 | 5.00 | 5.25 | ||
| Kookmin Bank | 3.90 | 4.30 | 4.50 | 4.75 | 5.00 | 5.25 |
Term deposit rates
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3 Comments
So why would anyone invest their money with ASB, given these pitiful returns, you would be better off going to one of the other banks and investing in one of their higher advertised rates for the same term. I negotiate hard with banks for the best rates, play one off against the other and the rates I get are better than anything advertised...
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