Depositors not put off by low rates

John Kavanagh
Despite the steady erosion in deposit rates over the past year, banks' deposit inflows have held up well. Growth in household deposit balances outstripped growth in mortgage balances during the 12 months to September.

According to the latest Australian Prudential Regulation Authority banking statistics, bank household deposit balances grew by 9.1 per cent over the year to September.

Lender's mortgage balances grew by 6.8 per cent over the same period.

The rate of deposit growth has accelerated in recent months, with balances up 3.4 per cent in the September quarter (an annualised rate of 13.6 per cent).

Balances grew by one per cent in September, compared with the previous month.

Deposit-takers growing above system include Bank of Sydney (whose deposit book grew by 16.6 per cent over the year to September), AMP Bank (up 15.6 per cent), National Australia Bank (up 10.8 per cent), Westpac (up 10.7 per cent), HSBC (up 10.2 per cent) and Commonwealth Bank (up 10.1 per cent).