Depositors had a better time of it in June, with a number of banks lifting their at-call savings rates and many increasing term deposit rates.
It was a different story in May, when a minority of deposit-taking institutions passed on any of the Reserve Bank’s 25 basis point increase in the cash rate and only a handful passed on the full rate increase.
So striking was the snub to savers that the Council of Financial Regulators said in a statement issued on June 23 that it would monitor the situation closely.
In its latest update, comparison site Mozo reported that rates on at-call deposits had “a shot in the arm” in June.
Bank of Queensland increased the ongoing bonus rate on its Smart Saver account from 80 basis points to 2 per cent.
Citi increased the introductory rate on its Online Saver account by 75 bps to 2.1 per cent.
ING increased the ongoing bonus rate on its Savings Maximiser account by 75 bs to 2.1 per cent.
Macquarie Bank announced that funds in its everyday bank account would earn 1.5 per cent for amounts up to $250,000, with no restrictions or requirements. The bank also increased the introductory rate on its Savings Account by 30 bps to 1.8 per cent.
Other deposit takers to lift rates last month included Bankwest, MyState, Qudos Bank, Rabobank, St George, Ubank and Westpac.
Top rates in the at-call market include 2.10 per for the ongoing bonus rate on ING’s Savings Maximiser; 2.1 per cent for the introductory rate on both Citi’s Online Saver and Rabobank’s High Interest Savings Account; and 1.5 per cent for a base rate on the Macquarie Savings Account.
In the term deposit market Firstmac, Gateway Bank and Goldfields Money are all offering 3.15 per cent for 12 months.
In every other category, AMP Bank and Judo Bank are the rate leaders. For terms under 12 months AMP is offering 2.85 per cent for 11 months and Judo is offering 2.85 per cent for nine months.
AMP is offering 3.65 per cent for two years. Judo is offering 4 per cent for three years, 4.15 per cent for four years and 4.25 per cent for five years.
According to the latest APRA data, deposit flows have slowed. Total banks retail deposits grew 23.5 per cent over the two years to May and 13.1 per cent over the past 12 months.
But over the past three months balance growth was down to 2.3 per cent – an annualised rate of 9.2 per cent. In May, balances grew 0.2 per cent (2.4 per cent annualised).