About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Tuesday, November 19th, 7:20AM
rss
Latest Headlines

Banks innovate in short-term rates

After a week’s breather, short-term deposit rates from banks came under focus once again but this time it is for a short period.

Monday, December 6th 2010, 6:07PM 1 Comment

by Sophia Rodrigues

Rabobank via RaboDirect drove the innovation with the launch of BankaRate where it offered special interest rates across all terms. The best rate was the 6% on six-month deposits for a minimum amount of $5,000. The offer was snapped up within few hours of opening, prompting the bank to reintroduce but with minimum amount of $20,000 and then to $25,000.

The BankaRate specials attracted investors towards only short-term deposits with longer-term attracting very minimal deposits. For example, the 6.70% on four-year deposits with minimum amount of $5,000 managed to get subscription for just 6% of the total amount the bank put on offer.

Kiwibank quickly followed RaboDirect with its own BookaRate on one and two-year deposits. At 5.50% on one-year deposits, the specials are offering 20 basis points over Kiwibank's regular rate of 5.30%.

Finance companies were active last week with a few making downward moves to interest rates while Finance Direct was an exception when it increased across maturities starting from six months to five years.

Finance Direct raised six month deposit rates by 50 basis points to now offer the best rate of 7.25% among finance companies. But as the company is not rated, investors are left to make their own judgement about the safety of their investment. Finance Direct's 10.50% on 18-month deposits is the best on offer for a minimum deposit of $1,000.

PGG Wrightson made a slew of cuts, but most of them were concentrated in non-guaranteed debentures while six-month term rates were hiked by 25 basis points. With the changes, the BB-rates PGG Wrightson's rates for both guaranteed and non-guaranteed deposits hardly look attractive compared with the AA-rated UDC Finance or the BB+ rated Marac Finance.

In fact, UDC Finance has just reduced rates across all the terms, and only increased 12-month rate where it is now offering 5.50%, just above Kiwibank's 5.30% on regular deposits and in line with its 5.50% BookaRate deposits.

« Rates Round Up: Dec 6Another finance company shuts up shop »

Special Offers

Comments from our readers

On 7 December 2010 at 5:19 pm Christopher said:
Are the Banks really competing for deposits ? Hardly the sort of enticement for savers to lock money into longer term deposits.
Commenting is closed

 

print

Printable version  

print

Email to a friend
Today's Best Bank Rates
Rabobank 1.75  
Based on a $50,000 deposit
More Rates »
News Bites
Latest Comments
  • When is a client really a client?
    “And this subtle upgrade to the understanding of a complaint. Which changes the ISO definition from an expression of dissatisfaction...”
    19 hours ago by JPHale
  • When is a client really a client?
    “Just released additional standards from the FMA. Record keeping potentially until 7 years after the death of the life...”
    19 hours ago by JPHale
  • When is a client really a client?
    “@ReganT interesting that the two life advisers involved with the code working group discussion are the ones being argued...”
    24 hours ago by JPHale
  • When is a client really a client?
    “In a previous reply I responded to the concept of payment as a trigger. I actually agree it’s not. While we don’t often...”
    2 days ago by regant
  • When is a client really a client?
    “Tash are you being deliberately obtuse? I didnt say you have to keep sending/giving disclosure every year, I said you have...”
    2 days ago by regant
Subscribe Now

Deposit Rates newsletter

Previous News

MORE NEWS»

Most Commented On
News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com