Even though wholesale interest rates are rising notably, and there has been some increase in home loan rates, the movements in retail term deposit rates have been tamer.
But some have been moving and almost all these rates are up, even if only marginally.
However, these changes have altered who has the 'best' (=highest) rates on offer now.
Today's (Tuesday) notable change has come from BNZ, raising rates for six specific terms.
After this change, the highest rate from;
- any bank for 5/6/7 months is Bank of India's 3.70%. For a main bank it is 3.45% from all of them.
- any bank for 8 to 11 months is Heartland Bank's 3.75%. For a main bank it is 3.60% from both BNZ and Westpac.
- any bank for 1 year is Rabobank's 3.95%. For a main bank it is 3.90% at BNZ.
Higher rates are available from some non-bank deposit takers who have the Deposit Compensation Scheme protection.
The rates for Kiwi Bonds are now notably low; they were last updated on March 5, and there have been significant wholesale movements since then. A rate change could come soon.
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.)
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 six weeks. The yellow colour code is for those under 4% and these have been reducing from the long end. Bolded rates are the "best-bank", the highest carded rate from any bank at this time. The blue-coded rates are those under 3%. We might start to see some 5% rates appearing soon if the rates pressure is sustained.
This table only lists institutions covered by the Depositor Compensation Scheme.
| for a $25,000 deposit May 19, 2026 |
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 | 3.70 | 4.00 | 4.20 | 4.50 |
 |
AA- | 3.00 | 3.45 | 3.55 | 3.75 | 4.00 | 4.15 | 4.50 |
 |
AA- | 3.00 | 3.45 | 3.60 | 3.90 | 4.00 | 4.20 | 4.50 |
 |
A | 3.10 | 3.45 | 3.40 | 3.85 | 4.25 | 4.50 | |
 |
AA- | 3.00 | 3.45 | 3.60 | 3.85 | 4.00 | 4.20 | 4.40 |
| Kiwi Bonds. 'risk-free' | AA+ | 2.25 | 2.50 | 3.00 | ||||
| Rating | 3/4 mths |
5 / 6 / 7 mths |
8 - 11 mths |
1 yr | 18mth | 2 yrs | 3 yrs | |
| Other banks | ||||||||
| Bank of Baroda | BBB- | 3.20 | 3.60 | 3.60 | 3.60 | 3.60 | 3.65 | 3.85 |
| Bank of China | A | 3.30 | 3.65 | 3.70 | 3.75 | 3.80 | 4.10 | 4.35 |
| 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+ | 2.90 | 3.50 | 3.50 | 3.80 | 4.00 | 4.20 | 4.50 |
| Heartland Bank | BBB | 3.00 | 3.60 | 3.75 | 3.70 | 4.00 | 4.30 | 4.50 |
| ICBC | A | 3.25 | 3.65 | 3.70 | 3.85 | 4.05 | 4.35 | 4.65 |
 |
A | 3.10 | 3.65 | 3.65 | 3.95 | 4.00 | 4.40 | 4.55 |
 |
BBB | 3.00 | 3.45 | 3.55 | 3.80 | 4.00 | 4.20 | 4.50 |
 |
BBB+ | 3.00 | 3.45 | 3.50 | 3.80 | 4.00 | 4.20 | 4.40 |
| 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 | 3.10 | 3.55 | 3.60 | 3.80 | 3.90 | 4.00 | |
| Heretaunga Bldg Society | 3.05 | 3.55 | 3.80 | 4.25 | ||||
| Nelson Building Society | BB+ | 2.75 | 3.40 | 3.50 | 3.70 | 3.85 | 4.10 | 4.40 |
| Police Credit Union | BB+ | 3.00 | 3.45 | 3.55 | 3.70 | 3.80 | 4.00 | |
| UnityMoney | BB | 3.00 | 3.45 | 3.40 | 3.35 | 3.50 | 3.55 | 3.55 |
| Wairarapa Bldg Society | BB+ | 3.10 | 3.45 | 3.45 | 3.85 | 3.90 | 4.25 | |
| Finance companies with DCS protection | ||||||||
| Christian Savings | BB+ | 3.00 | 3.50 | 3.55 | 3.75 | 3.85 | 4.10 | 4.15 |
| Finance Direct | 3.95 | 4.30 | 4.50 | 4.25 | 4.50 | |||
| General Finance | BB | 3.50 | 3.80 | 4.00 | 4.55 | 4.80 | 4.80 | 4.90 |
| Gold Band Finance | BB- | 3.90 | 4.00 | 4.10 | 4.85 | 4.90 | 4.90 | |
| Liberty Financial | BBB | 3.10 | 3.80 | 3.80 | 4.00 | 4.10 | 4.20 | 4.30 |
| Mutual Credit Finance | B+ | 3.80 | 4.30 | 4.50 | 4.60 | 4.80 | ||
| Welcome | 4.00 | 4.15 | 4.35 | 4.35 | 4.50 | 4.65 | ||
| Xceda Finance | B+ | 3.80 | 4.00 | 4.25 | 4.55 | 4.55 | 4.65 | |
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2 Comments
I placed funds on TD in Australia earlier this year which provides an interesting comparison vs NZ:
- 6m rate ~5%, 12m rate 5+% longer term rates reducing (vs NZ longer term rates increasing)
That speaks loudly to the countries respective OCR/inflation expectations & probably also indicates that the current lower than average NZD/AUD Fx rate isn't going to significantly change for a couple of years.
Term Deposits Less Than 1 Year Rates | Compare Best Savings Accounts | interest.com.au
Term Deposits 1 To 5 Years Rates | Compare Best Savings Accounts | interest.com.au
Edit: Oz TDs also are govt guaranteed to $250k
Investment Guarantee Scheme (IGS)
Why are the levy rates for participating deposit takers (in the IGS) not publicly available?
I am curious about the levy rate differences between the different tiers of the NZ banking sector.
What drives this curiosity is the dramatic reduction in term deposit interest rates now offered by non-bank deposit takers. Finance companies in particular.
My understanding of finance companies operate in the segment of lending where the big main banks won't. Largely where lending is higher risk, attracting a higher interest rate for borrowers, reflecting the higher risk profile. And that was also reflected in (generally) significantly higher interest rates paid to depositors (who also carry that higher risk).
Then along comes the ISG and depositors interest rates have dropped significantly (1 yr to rate BNZ 3.9% vs General Finance 4.55%).
I suspect the he risk profile of lending by finance companies has not materially changed and borrowers will still be paying a higher risk premium interest rate. While the risk profile to the depositor has declined.
Has the ISG distorted the profitability of finance companies? Have they been enabled to extract a higher profit from the difference in lending rates over deposit rates?
Have they lowered the risk premium to lenders reflecting the cheaper cost of deposits?
Or have the risk weighting of interest rates to borrowers stayed the same, with all the reduction in risk weighting for deposit interest rates shifting into the ISG fund?
Without transparency on how the levy system is applied across deposit takers, how is the curious Joe Public able understand the degree to which the IGS impacts on deposit interest rates and various deposit takers?
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