Co-op Bank deposit rate beats rivals

Last updated 05:00 19/02/2013

Relevant offers

National business

Surge in 10-year passport applications expected Westfield malls in Lower Hutt and Hamilton to be rebranded after sale Nutella rejects personalised jar for five-year-old girl named Isis Seven condoms, 21 orgasms? A German court has ruled no The Facts of Life: The changing shape of Kiwis Health drink SOS Hydration seeks to raise $2.3m in crowdfunding campaign AFT Pharmaceuticals NZX and ASX listing to fund growth Stalled rebuild projects threaten upper South Island tourist industry Christchurch woman breaks tooth biting on 'screw inside Snickers bar' Speculation about Islington venison works decision premature - Silver Fern Farms

The Co-operative Bank is stealing a march on its bigger Australian-owned rivals, offering savers a 1.35 per cent premium on four-month fixed term deposits.

The scheme is open to new and existing members of the bank with between $2000 and $20,000 to invest.

At an annual interest rate of 4.6 per cent, that's a pre-tax return of $29.99 on the $2000 minimum amount at the end of the period, and $299.99 at the upper limit.

Offers from the big four banks - ANZ, ASB, BNZ and Westpac - range between 3 per cent and 3.5 per cent over a similar term, and require higher minimum deposits to qualify, typically $5000 to $10,000.

David Tripe, head of Massey University's banking studies faculty, said the real surprise was not that Co-operative's rate was so high, but rather that the offers from major lenders were so low.

"The sort of implied rate other banks are offering sounds extremely low," he said.

The closest offers to Co-operative's are from Heartland Bank and Kiwibank.

Over a four-month term, Heartland is offering a rate of 3.9 per cent on a $1000 deposit, and 4 per cent on $5000. Kiwibank is offering 4.1 per cent on a $5000 deposit over the same period.

Tripe said these types of promotions were typically a means of attracting new customers or keeping existing ones - an approach typified by Kiwibank. He said he was unaware of deposit pressures on banks at the moment.

Under banking rules implemented in the wake of the Global Financial Crisis, local banks are required to hold a higher portion of their capital as local deposits.

Ad Feedback


Special offers

Featured Promotions

Sponsored Content