ANZ has raised fixed home loan rates, falling in behind ASB who moved on Monday.
And they have raised their term deposit offers as well. Most of the moves up are relatively trivial, but they increased their 18 month term deposit offer by +30 bps to 6.00%.
That makes ANZ the first (and only) main bank to offer a 6% rate in the current rising cycle.
Rates at this level are already in the market, but only from challenger banks. Rabobank also offers 6.00% for 18 months.
However, interest.co.nz has heard of many cases at a range of banks where existing clients who roll over significant term deposits are offered rates of either 6.00% or 6.10% for a one year term. These are offered within 'staff discretionary limits', but are not carded rates.
Now with a main bank offering 6% as a carded rate, those staff discretions may have to be raised. It is always worthwhile to try and negotiate the rate. Your success will depend on how valuable the bank sees your business.
We should also note that SBS Bank has recently withdrawn its market-leading 6.50% 12-month rate, replacing it with 6.00% for that term.
(Details of the ANZ home loan rate changes are in a companion story, here.)
One risk savers should watch is the cost of wholesale money and you can do that looking at swap rates. You can do that here. Today (Tuesday), wholesale swap rates jumped again on global influences - but not the one year swap rate
Almost all banks are pricing longer rates lower than their one year offers, and that inversion is growing, although that inversion has eased a little with this latest ANZ move
An easy way to work out how much extra you can earn is to use our full function deposit calculator. We have included it at the foot of this article. That will not only give you an after-tax result, you can tweak it for the added benefits of Term PIEs as well. It is better you have that extra interest than the bank, especially if you are in the 39% tax bracket - PIEs are taxed at 28% flat.
* Kookmin Bank's 6.10% one year offer is for deposits of $100,000 and more. For a $10,000 minimum it is 6.00%.
The latest headline rate offers are in this table after the recent increases.
| for a $25,000 deposit August 23, 2023 |
Rating | 3/4 mths |
5 / 6 / 7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs |
| Main banks | ||||||||
| ANZ | AA- | 4.30 | 5.80 +0.05 |
5.85 +0.05 |
5.95 +0.05 |
6.00 +0.30 |
5.50 | 5.25 |
 |
AA- | 4.20 | 5.75 +0.10 |
5.80 +0.15 |
5.90 +0.05 |
5.75 | 5.70 | 5.60 |
 |
AA- | 4.30 | 5.75 | 5.80 | 5.90 | 5.70 | 5.50 | 5.20 |
 |
A | 4.20 | 5.85 | 5.85 | 5.90 | 5.70 | 5.20 | |
 |
AA- | 4.30 | 5.75 | 5.75 | 5.90 | 5.50 | 5.40 | 5.20 |
| Other banks | ||||||||
| Bank of China | A | 4.70 | 5.88 | 6.08 | 6.18 | 5.80 | 5.50 | 5.30 |
| China Constr. Bank | A | 5.00 | 5.85 | 5.90 | 6.00 | 5.85 | 5.50 | 5.40 |
| Co-operative Bank | BBB | 4.20 | 5.75 | 5.80 | 5.90 | 5.75 | 5.60 | 5.50 |
| Heartland Bank | BBB | 4.00 | 5.90 | 6.00 | 6.10 | 5.35 | 5.30 | 5.30 |
| ICBC | A | 4.70 | 5.65 | 5.90 | 6.00 | 5.80 | 5.45 | 5.40 |
| Kookmin Bank | A | 4.40 | 5.60 | 5.70 | 6.00* | 5.20 | 5.20 | |
 |
A | 4.75 | 5.90 | 6.00 | 6.15 | 6.00 | 5.70 | 5.60 |
 |
BBB | 3.90 | 5.50 | 5.40 | 6.00 | 5.35 | 5.35 | 5.35 |
 |
A- | 4.25 | 5.30 | 5.40 | 6.00 | 5.50 | 5.50 | 5.25 |
Term deposit rates
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50 Comments
True, swaps are rising nicely and they are a good indicator for deposit rates 1 year or over. Therefore, it it likely that we will see some moderate further increases to deposit rates, if such trend does not reverse. However current swaps are not predicting a 7% level.
I thin that is unlikely mainly because banks seem to be wanting to increase their margins, so again savers are missing out. IMO we need far better rates on the online call accounts. Back prior to the GFC online call accounts were often as good as TDs. But at the moment, saving and online call accont rates aren't great.
You realize you lose 33% to the taxman right?
Wrong. If that is his only income he will only be taxed at 10.5%
100k @ 6.1 = $6100.00 of income.
Rates for each doĺlar of income,!.. not investment total
Up to $14,000 10.5%
Over $14,000 and up to $48,000 17.5%
Over $48,000 and up to $70,000 30%
Over $70,000 and up to $180,000 33%
Remaining income over $180,000 39%
https://www.ird.govt.nz/income-tax/income-tax-for-individuals/tax-codes…
NO! Based on the FACTS provided 10.5%.
33% depends on how he has organised his finances and What other incomes he has.
May i suggest a link
Well Tom. Tell us what you would do with $100K --- if you have it. Waiting.
Consider also. 1 the $100K is only part of a picture. 2. Currently the markets look jittery to me, a big big drop is unlikely, but possible.
And I did not advocate anything. DC's excellent informed article is about interest, and I tossed in some actual anecdotal.
Hi KH. I have a similar amount of money sitting in a westpac TD. Mines slightly below 100k but pretty close for comparison. I pay 33% tax. Hence the comment. I would totally put it in a TD because property is going no where short term. I have a little invested in crypto too but for me... a TD is low risk. Thanks
Thanks Tom. We are on much the same page. But I was a little offended at your quip "you do realise....."
I realise about tax very very well. But often one is stuck with it and there are no useful choices.
And also I will be paying no tax, due to some accumulated losses to use up. Which were a great present, and not disastrous, resulting from some restructuring some years ago.
Anyway. 6.1% on the TD just by saying. When I actually do it next week I will lean on Westpac a bit and on past performance she will likely say 6.2%. Which will pay for a few weeks morning Capas
Tom, if you (or anyone else reading this) are using a regular term deposit with a 33% tax rate, you may want to look into PIE terms. They're set up in such a way that you only pay 28% tax, which for a $100K investment at 6% works out to be a net gain of $300. Might as well have it than not, right?
What incomes!?
He presumed he was in the 33% Bracket.
The correct/ responsible response would be to determine his total income.
He, could have been on a wage of 300k or or had 1mil in the bank earning nothing ( of which some was a deposit for a quick house purchase andvthe rest he is living off)and 100k spare to invest.. thus 10.5%
Tom Jones is not a qualified investment advisor... so he should be very careful about loose words and statements with other peoples money.
If you have a lump sum in a 90 day call account you can give notice on a portion of it. Say you divide it up into 6 rolling notices at 15 day intervals you can get at 1/6 of your capital every fortnight. In the early stage it is possible to use the 30 day roll over until an ongoing steady state is achieved. If you dont need the money put it back and give 90 days notice immediately to keep the steady state active.
I wouldn't mind some free help with my grammar. I thought it was done in a tasteful way and not used as the basis for rejection of the message as it sometimes is.
It was a learning opportunity and likely to enhance effective communication in the comment section. No shortage of things to be offended about nowadays.
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