The unexpected mortgage rate rise by Westpac, and followed by the Co-operative Bank recently, brought companion rises in term deposit (TD) rates - also unexpected.
And today (Monday, December 15), Kiwibank has followed the leaders with its own term deposit rate increases.
Few were expecting any changes now, certainly not just before the holiday period. But they have been driven by wholesale money changes, which seem to be increasing internationally at the longer terms.
So, surprise or not, we are seeing some rises for TDs too, and at the four and five year terms we are seeing the re-emergence of 4% rates. Few savers are likely to be drawn to rates over one year, but undoubtedly savers will be interested in the trend.
One thing the Kiwibank changes do is emphasise the small premium they offer for six month and one year TDs over their main bank rivals.
In addition it shines a light on the three year rate offer from the Co-operative Bank because they have become the only bank to offer 4% rates at present for these terms. (ASB, Bank of China, and ICBC offer rates at this level for five year deposits.)
Separately, we should note the spreading of lower rates among the non-bank deposit takers (who are covered by the Depositor Compensation Scheme). Presumably there are flows in their direction as some savers chase the taxpayer guarantee depositor protection. But that comes at a cost to these firms through the risk-based premium they pay for that coverage, limiting what they can realistically offer.
When you invest, always check how interest is compounded. Depending on how much you are committing, compounding more often is materially better. But some banks advertise their "interest at maturity" rates different to their compounding rates, which for some can be set a little lower. Both Kiwibank and Rabobank do this, although most other main banks don't.
Use the calculator at the foot of this article to see the differences.
We should also point out that after-tax returns can be enhanced for some savers with higher tax rates by the choice of PIE structures. Not all institutions offer these, but most of the main banks do.
Always ask a bank for a better rate. Many bank staff have discretion to offer more than the advertised rate. (And check your bank's app offers as they too are often enhanced to retain you). We have been surprised to hear recently of even big banks agreeing to a small boost, when asked.
Use the term deposit calculator here, or the one below the table, to calculate your expected net after-tax returns.
The latest headline term deposit rate offers are in this table after the recent changes over the past three weeks. The yellow colour code for those under 4% and has spread comprehensively. Bolded rates are the "best-bank", the highest carded rate from any bank at this time. The blue-coded rates are those under 3%.
This table only lists institutions covered by the Depositor Compensation Scheme.
| for a $25,000 deposit December 15, 2025 |
Rating | 3/4 mths |
5/6/7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs |
| Main banks | ||||||||
| ANZ | AA- | 3.10 | 3.45 | 3.40 | 3.40 | 3.40 | 3.45 | 3.60 |
 |
AA- | 3.00 | 3.40 | 3.40 | 3.40 | 3.40 | 3.45 | 3.65 |
 |
AA- | 3.00 | 3.50 | 3.40 | 3.40 | 3.40 | 3.45 | 3.60 |
 |
A | 3.10 | 3.55 | 3.40 | 3.55 | 3.75 | 3.90 | |
 |
AA- | 3.00 | 3.45 | 3.40 | 3.40 | 3.40 | 3.45 | 3.60 |
| Kiwi Bonds. 'risk-free' | AA+ | 2.50 | 2.50 | 2.75 | ||||
| Rating | 3/4 mths |
5 / 6 / 7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs | |
| Other banks | ||||||||
| Bank of Baroda | BBB- | 3.35 | 3.65 | 3.60 | 3.60 | 3.60 | 3.65 | 3.85 |
| Bank of China | A | 3.25 | 3.60 | 3.50 | 3.55 | 3.50 | 3.55 | 3.80 |
| Bank of India | BBB- | 3.25 | 3.70 | 3.70 | 3.70 | 3.80 | 3.85 | 3.85 |
| China Constr. Bank | A | 2.70 | 3.20 | 3.20 | 3.20 | 3.25 | 3.25 | 3.45 |
| Co-operative Bank | BBB+ | 3.00 | 3.50 | 3.40 | 3.40 | 3.45 | 3.70 | 4.00 |
| Heartland Bank | BBB | 3.00 | 3.40 | 3.40 | 3.40 | 3.40 | 3.45 | 3.60 |
| ICBC | A | 3.25 | 3.60 | 3.50 | 3.50 | 3.50 | 3.55 | 3.80 |
 |
A | 3.05 | 3.55 | 3.45 | 3.50 | 3.50 | 3.50 | 3.70 |
 |
BBB | 3.15 | 3.55 | 3.45 | 3.45 | 3.45 | 3.50 | 3.70 |
 |
BBB+ | 3.10 | 3.40 | 3.40 | 3.40 | 3.45 | 3.50 | 3.65 |
| Non-Bank Deposit Takers | Rating | 3/4 mths |
5 / 6 / 7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs |
| Community institutions with DCS protection | ||||||||
| First Credit Union | BB | 3.40 | 3.65 | 3.65 | 3.65 | 3.70 | 3.70 | |
| Heretaunga Bldg Society | 3.05 | 3.55 | 3.50 | 3.55 | ||||
| Nelson Building Society | BB+ | 2.75 | 3.20 | 3.15 | 3.15 | 3.50 | 3.50 | 3.70 |
| Police Credit Union | BB+ | 3.10 | 3.45 | 3.40 | 3.40 | 3.40 | 3.45 | |
| UnityMoney | BB | 3.15 | 3.40 | 3.35 | 3.30 | 3.35 | 3.45 | 3.45 |
| Wairarapa Bldg Society | BB+ | 3.20 | 3.45 | 3.45 | 3.65 | 3.45 | 3.45 | |
| Finance companies with DCS protection | ||||||||
| Christian Savings | BB+ | 3.00 | 3.50 | 3.50 | 3.50 | 3.00 | 3.55 | 3.70 |
| Finance Direct | 2.95 | 3.55 | 3.55 | 3.55 | 3.70 | |||
| General Finance | BB | 3.50 | 3.70 | 3.80 | 3.90 | 4.00 | 3.80 | 3.80 |
| Gold Band Finance | BB- | 2.75 | 2.75 | 4.00 | 4.00 | 4.05 | 4.20 | |
| Liberty Financial | BBB | 2.95 | 3.60 | 3.65 | 3.80 | 3.80 | 3.80 | 3.80 |
| Mutual Credit Finance | B+ | 3.30 | 3.30 | 3.40 | 3.50 | |||
| Welcome | 3.60 | 3.80 | 3.90 | 4.00 | 4.10 | 4.20 | ||
| Xceda Finance | B+ | 3.50 | 3.50 | 3.60 | 3.60 | 3.65 | 3.75 | |
Term deposit rates
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Daily swap rates
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