A 6% term deposit offer rate is spreading, for now at least.
Now TSB is offering it for a one year term.
They join Heartland Bank and Rabobank with a 6% one year TD offer*. But that makes TSB the largest bank so far to offer that rate.
The closest major bank is 5.75% for one year from Kiwibank. All the big Aussie banks are on 5.70%.
The most competitive ~3 month rate is China Construction Bank's 4.70% for 4 months.
The most competitive ~6 month rates are 5.60% from the Bank of China, China Construction Bank, and Rabobank.
At the ~9 month range, Westpac's 5.50% is good for an 8 month term. But Rabobank offers 5.90% for 9 months, closely followed by Heartland Bank, and those two Chinese banks, all with offers higher in that range than Westpac.
But 6% at 12 months is kind of the peak right now, and rates for terms longer than that are tending to show some softness. Not only are all of them lower, the background trend is for lower rates. Certainly that is what wholesale rate pricing has been showing recently. The long end is influenced heavily by international markets, and rates have topped out there across the globe.
But the risks to banks offering 6% isn't high. Most savers much prefer 90 day to 9 month terms. A 6% offer might start a conversation at a bank, but most savers will probably opt for a shorter term when they are forced to make a decision. Banks know this; it is a Kiwi saving behaviour that has been around for decades. The one year term isn't as popular as it might seem. But those who favor layering their TD savings across terms and institutions could well be attracted.
Are these short-term rate offers of one year and less enough to satisfy the RBNZ and its call for better offers to savers? Who knows? Savers who go short are their own worst enemy. But if the current levels hold while wholesale rates slip, perhaps they will be.
Who will be the next to join TSB on 6%? It may be a longish wait for offers from the majors.
An easy way to work out how much extra you can earn is to use our full function deposit calculator. We have included it at the foot of this article. That will not only give you an after-tax result, you can tweak it for the added benefits of Term PIEs as well. It is better you have that extra interest than the bank, especially if you are in the 39% tax bracket - PIEs are taxed at 28% flat.
(* The first bank to offer 6% for one year was SBS Bank, but their offer has now expired.)
The latest headline rate offers are in this table after the recent increases.
| for a $25,000 deposit May 12, 2023 |
Rating | 3/4 mths |
5 / 6 / 7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs |
| Main banks | ||||||||
| ANZ | AA- | 4.10 | 5.35 | 5.40 | 5.70 | 5.30 | 5.20 | 5.10 |
 |
AA- | 4.10 | 5.40 | 5.45 | 5.70 | 5.40 | 5.40 | 5.30 |
 |
AA- | 4.10 | 5.35 | 5.40 | 5.70 | 5.35 | 5.30 | 5.20 |
 |
A | 4.05 | 5.30 | 5.25 | 5.75 | 5.20 | 5.00 | |
 |
AA- | 4.10 | 5.40 | 5.50 | 5.70 | 5.40 | 5.30 | 5.20 |
| Other banks | ||||||||
| Bank of China | A | 4.50 | 5.60 | 5.85 | 5.95 | 5.60 | 5.50 | 5.40 |
| China Constr. Bank | A | 4.70 | 5.60 | 5.85 | 5.95 | 5.85 | 5.45 | 5.45 |
| Co-operative Bank | BBB | 4.10 | 5.35 | 5.40 | 5.70 | 5.40 | 5.35 | 5.30 |
| Heartland Bank | BBB | 4.00 | 5.50 | 5.80 | 6.00 | 5.35 | 5.30 | 5.30 |
| HSBC | AA- | 3.95 | 5.10 | 5.30 | 5.40 | 5.20 | 5.00 | 5.00 |
| ICBC | A | 4.40 | 5.50 | 5.75 | 5.85 | 5.55 | 5.45 | 5.45 |
 |
A | 4.40 | 5.60 | 5.90 | 6.00 | 5.85 | 5.40 | 5.40 |
 |
BBB | 3.90 | 5.00 | 5.40 | 5.55 | 5.35 | 5.35 | 5.35 |
 |
A- | 4.25 | 5.20 | 5.40 | 6.00 | 5.30 | 5.30 | 5.10 |
Term deposit rates
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