Term deposits down in same month RBA cut cash rate
Reserve Bank of Australia figures have revealed the value of term deposits held with banks fell 1.1% in May to A$515 billion, compared with the previous month.
The drop in term deposit balances came in the same month the RBA Board cut the official cash rate to 2%. The figures also showed a sizeable drop of 3.6% in the value of term deposits since the start of the year.
Several banks such as the Commonwealth Bank and NAB that held back part of the cash rate in May, cutting mortgage rates by less than 25 basis points to maintain deposit rates, actually grew their deposits in the month.
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This comes as the latest banking statistics from the Australian Prudential Regulation Authority (APRA) showed several banks including AMP, Arab Bank, BOQ, Suncorp and Citibank have experienced deposit outflows in recent months.
APRA found that deposit balances grew by just 0.1% in May compared with the previous month, while housing finance balances increased by 0.5%.
With lending growth exceeding growth in deposit flows, which hasn’t occurred since the financial crisis, banks may have to source more funding from the wholesale market or sacrifice some margin and compete more for deposits.
See the latest APRA banking statistics here.
Term deposit comparisons on Mozo - last updated February 27, 2021
Term Deposit
interest rate
Minimum deposit
Govt Deposit Guarantee
0.75% p.a.
9 months$10,000Yes up to $250,000$0 Set up and no ongoing account-keeping fees. Interest rate depends on balance amount. Optional 3,6,9 or 12 month terms. Balances from $10,000.
CompareCompareTerm Deposit
$0 Set up and no ongoing account-keeping fees. Interest rate depends on balance amount. Optional 3,6,9 or 12 month terms. Balances from $10,000.
- Minimum deposit
- $10,000
- Maximum deposit
- $2,000,000
- Can interest be paid to another bank?
- no
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Citi Term Deposit
Term Deposit
interest rate
Minimum deposit
Govt Deposit Guarantee
0.90% p.a.
1 year$1,000Yes up to $250,000Terms from 3 to 36 months. A guaranteed rate. No account keeping fees. Enjoy a fixed rate or return. Get a written notice before your deposit matures.
CompareCompareTerm Deposit
Terms from 3 to 36 months. A guaranteed rate. No account keeping fees. Enjoy a fixed rate or return. Get a written notice before your deposit matures.
- Minimum deposit
- $1,000
- Maximum deposit
- $499,999
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Teachers Mutual Bank Term Deposit
Term Deposit
interest rate
Minimum deposit
Govt Deposit Guarantee
1.05% p.a.
1 year$5,000Yes up to $250,000Flexible 3 to 60 month terms available. $0 account keeping fees. Flexible interest payments at maturity or annually. Minimum $5,000 deposit.
CompareCompareTerm Deposit
Flexible 3 to 60 month terms available. $0 account keeping fees. Flexible interest payments at maturity or annually. Minimum $5,000 deposit.
- Minimum deposit
- $5,000
- Maximum deposit
- $100,000
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
Read our Mozo Review to learn more about the BankVic Term Deposit
Term Deposit
interest rate
Minimum deposit
Govt Deposit Guarantee
0.95% p.a.
1 year$1,000Yes up to $250,000Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2020 for Term Deposits.^
CompareCompareTerm Deposit
Great rates and incentives incl. 0.10% added loyalty bonus at renewal. Option to have interest paid to another bank. Winner of the Mozo Experts Choice Awards 2020 for Term Deposits.^
- Minimum deposit
- $1,000
- Maximum deposit
- $1,000,000
- Can interest be paid to another bank?
- yes
- Automatic rollover
- yes
Read our Mozo Review to learn more about the Judo Bank Term Deposit
^See information about the Mozo Experts Choice Term Deposits Awards
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