These are the banks with the highest term deposit rates in 2014 for two core terms.
They are their 'at maturity' offers for deposits of $10,000 or more.
They are also 'before tax', and represent what was offered in the last week of each month.
For banks that offer term PIEs, savers might get an even better after tax return using these funds.
Use our handy deposit calculator to work out your likely actual after tax return here.
The bank who consistently offered the highest six month rate in 2014 was Kiwibank - they feature eight times in our table, and in every month from July onward. RaboDirect and the Co-operative Bank are also prominent in the list featuring six times each.
The bank who consistently offered the highest one year rate in 2014 was RaboDirect achieving the 'best offer' position in five months.
(The rates in parentheses in the table are the average of all bank offers.)
| Term deposits | 6 months | offered by ... | 12 months | offered by ... |
| January 2014 |
4.10% (3.84%) |
Kookmin Bank |
4.30% (4.05%) |
Kookmin Bank Bank of India |
| February |
4.10% (3.84%) |
Kookmin Bank |
4.30% (4.06%) |
Kookmin Bank Bank of India |
| March |
4.10% (3.87%) |
Co-operative Bank Kiwibank Kookmin Bank |
4.30% (4.08%) |
Kookmin Bank Bank of India |
| April |
4.10% (3.92%) |
Co-operative Bank Kiwibank Kookmin Bank |
4.35% (4.13%) |
Kiwibank |
| May |
4.25% (4.01%) |
RaboDirect |
4.50% (4.23%) |
Heartland Bank |
| June |
4.25% (4.04%) |
RaboDirect |
4.50% (4.29%) |
Co-operative Bank Heartland Bank Kiwibank RaboDirect |
| July |
4.50% (4.14%) |
Kiwibank |
4.60% (4.37%) |
Co-operative Bank |
| August |
4.50% (4.13%) |
Co-operative Bank Kiwibank RaboDirect |
4.65% (4.39%) |
RaboDirect |
| September |
4.50% (4.13%) |
Co-operative Bank Kiwibank RaboDirect |
4.65% (4.41%) |
RaboDirect |
| October |
4.50% (4.14%) |
Co-operative Bank Kiwibank RaboDirect |
4.65% (4.43%) |
RaboDirect |
| November |
4.50% (4.15%) |
Co-operative Bank Kiwibank RaboDirect |
4.65% (4.43%) |
RaboDirect |
| December |
4.50% (4.14%) |
Kiwibank |
4.60% (4.43%) |
Co-operative Bank Kiwibank SBS Bank |
For some, perhaps one somewhat unexpected thing stands out in this analysis: for both terms, rates actually rose as the year progressed.
That was because the RBNZ increased the OCR.
But banks did not pass on the full OCR hikes that happened in 2014. The RBNZ raised their benchmark policy rate by a full +1% (from 2.5% to 3.5%) in the first half of 2014 but banks passed on only 0.3% of that - or 0.4% on a 'best rate' basis. (In fact, none of the big Aussie-owned banks feature in our table.)
The reason: banks are flush with deposits because households are building their bank accounts faster than they are borrowing. Household bank accounts rose $10.2 bln in 2014 to $134 bln while housing debt rose 'only' $8.3 bln in the same period. Consumer debt rose another $0.8 bln as well.
And banks have the option to borrow more cheaply offshore.
Theoretically savers have offshore options too, but they are not very practical for most. And almost all other countries offer lower rates to savers than are available here. Saving interest rates fell in the rest of the world which is in contrast to our rises.
In fact, in Australia at the end of 2014, the 'best offer' for a six month term deposit is 3.75% and the 'best offer' for a 12 month term deposit is also 3.75%. Most main banks offer up to 0.50% lower than these.
Saving in New Zealand has one other attribute that few major economies can offer - interest rates offered are higher than inflation, even after income taxes are deducted. While they may not be high and compare poorly to those offered in the unsustainable 2004-2008 period, returns are positive and 'real'. The full force of 'financial repression' has not imposed itself here (- yet?).
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