Rates Update: BNZ maintains short term rate leadership
It is not very often that one sees a market leader hike its deposit rates when the competitors are still some way off. But that's exactly what Bank of New Zealand did last week when it raised its five-month deposit rates by five basis points - a term where the bank has been a leader for some months now.
Monday, 8 November 2010
by Sophia Rodrigues
BNZ's move is likely in response to ASB getting competitive in six-month deposits where the bank raised the rate by 20 basis points the week before to 5.10%, matching the rate offered by ANZ.
However, BNZ's new rate is still attractive and offering 5.20% on five-month special term deposits. At the same time, the bank hiked the minimum amount on such deposits to $10,000.
The increase in the minimum amount is part of a wider move by BNZ to revert to the two rate brackets that it had combined in to one just over two weeks ago. As a result, BNZ has started offering attractive term deposit rates for an amount as less as $5,000.
The bank cut deposit rates sharply for the $5,000-$9,999 amount bracket which has meant the $5,000-$49,000 range is now separated in to two groups of $5,000-$9,999 and $10,000-$49,999.
For the nine-month term, BNZ cut the deposit rate by 10 basis points to 5.20% but still remains the leader, with most other major banks offering 5.10%.
Among other rate changes, HBS Bank cut deposit rates for 6-12 term deposit terms and also for three-year deposits. The 5.50% on three-year is easily beaten by all the major banks, but matches SBS Bank.
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