PSIS launches new PIE fund
PSIS has launched its first PIE fund as competition for deposit funding remains tight.
Tuesday, September 15th 2009, 3:48PM
by Paul McBeth
The mutual that evolved out of the Public Service Investment Society will offer nine-month terms at 4.65% and 18-month deposits at 5% for a minimum deposit of $5,000 in a PIE. Including tax benefits, the effective interest rates are 4.86% for 33% tax-payers and 5.25% for 38% tax-payers for the nine-month term and 5.22% and 5.65% for the 18-month term.
PSIS currently offers 4.65% on nine-month deposits as part of a special offer, with interest at maturity, and 5% on 18-month deposits of $10,000 or more.
Like PSIS capital notes, the government's deposit guarantee does not extend to cover deposits in the PIE fund.
At this point, the new fund does not have any fees, although if PSIS decides to introduce a charge, there will be a three-month lead-in period for existing investors.
Check and compare all PIE fund rates here
Paul is a staff writer for Good Returns based in Wellington.
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