With Westpac, unusually, showing some mettle, pricing offers in the all-important household deposit market over the last day or so have begun to take an overdue consumer-friendly turn.
The industry, and big banks in particular, were exposed two weeks ago by Banking Day for engaging in shady (even unprecedented) preferential pricing spreads on deposits for corporate and institutional customers – and treating household depositors like mugs.
Labelled ‘margin hoggers’ yesterday, the management and pricing committees of a range of banks appear to be responding to the bruising to their reputations from their habit this (and every) rising rate cycle of being prompt to reprice loans in line with rises in the RBA cash rate, yet much more sedentary in rewarding their most important mass market, their depositors.
Savings.com.au this morning lists the maximum interest rate on any broad-based consumer deposit product at 4.10 per cent. This is from Bank of Queensland, on its Future Saver Account (aimed at Gen Z).
The rate on ING’s Savings Maximiser product Savings.com.au quotes at 4.05 per cent, while MOVE Bank and Rabobank also have high interest, at call accounts starting with a four.
Westpac yesterday made the boldest pricing move of any major bank all year, with the bank saying it will increase the ongoing rate on its Life account by 0.90 percentage points to 3.50 per cent, for new and existing savings customers.
Westpac will also lift the bonus rate on its eSaver account by 0.95 percentage points to 3.50 per cent, but existing eSaver customers will miss out on the rate hike, RateCity pointed out.
“This rate from Westpac will help fuel competition in the savings sector,” Sally Tindall, research director at RateCity said yesterday.
“It’s refreshing to see a big bank reward its existing savers,” she said.
CBA has also gone beyond the RBA’s 25 bps rate hike (on Tuesday) “in some cases, announcing hikes of up to 0.30 percentage points,” on savings accounts, RateCity said.
ANZ has only increased the rate on its Plus Save account, while NAB has confined savings rate increases (so far) to its ubank brand.