- Two big four banks have dropped their 12-month term deposit rates on Thursday
- CommBank has cut 10-basis points off its special offer rate, taking it to 5.15% p.a.
- ANZ has also dropped its highest 12-month rate to 5.25% p.a.
CommBank has taken 10 basis points off its 12-month special offer rate, dropping the new rate to 5.15% p.a. (down from 5.25% p.a.).
It remains by far CommBank's highest term deposit rate and is open to new and existing personal and SMSF customers for balance amounts between $5,000 and $5 million with interest paid annually.
The drop follows CommBank's move to slash its six-month rates by at least one percentage point earlier this month, taking its best six-month rate to 3.50% p.a. for deposits between $50,000 and $5 million.
The latest rate drop is another sign Australia's largest household deposit holder is not expecting another rise to the Reserve Bank cash rate in the near term.
CommBank's 12-month special offer deal can be accessed online, via the CommBank app, or by visiting a branch with existing customers also able to renew by telephone.
ANZ also goes lower
On the same day, another big four bank dropped its 12-month term deposit rates five basis points lower.
ANZ's new best 12-month rate is 5.25% p.a. for deposit amounts between $5,000 and $1,999,999 with interest paid at maturity.
Lower rates (5.13% p.a. to 5.18% p.a.) apply for depositors opting for more frequent payments.
See also: Big Four Term Deposit Rates
It pulls ANZ's best term deposit rate back in line with the top rates of the other two big banks Westpac and NAB, as follows:
| Bank | Best rate | Deposit amount | Conditions | Interest paid |
| CommBank | 5.15% p.a. | $5,000 - $5m | Special offer on term deposits opened or renewed by personal and SMSF customers only | Annually |
| Westpac | 5.25% p.a. | $5,000 - $2m | Special offer (includes 0.10% bonus for existing customers opening or renewing online only) | Annually |
| NAB | 5.25% p.a. | $5,000 - $1,999,999 | Newly opened or renewed accounts | At maturity |
| ANZ | 5.25% p.a. | $5,000 - $1,999,999 | Newly opened or renewed accounts | At maturity |
How do these rates compare with smaller banks?
Typically, smaller banks have the jump on the big four when it comes to the market's best term deposit rates.
Among the highest 12-month rates currently on the market, according to the Savings.com.au data base, is 5.40% p.a., offered by Move Bank and Heartland Bank.
Some small banks are offering even higher rates for slightly shorter terms, such as Judo Bank's 5.45% p.a. for a seven-month deposit and Defence Bank's 5.55% p.a. for 10 months.
It's worth remembering consumer deposits with Authorised Deposit-Taking Institutions (ADIs) are government guaranteed up to $250,000 in the unlikely event a small bank goes bankrupt.
What do falls in big bank term deposit rates mean?
The falls in 12-month term deposit rates the week after the Reserve Bank's August cash rate decision is yet another signal the two big banks are comfortable there won't be another interest rate hike.
Economists from the big four are in agreement there will be no more interest rate increases in the current cycle and that the first cut to the 4.35% cash rate will come in the second half of 2027.
CommBank is slightly ahead of the other three with its forecast of a May 2027 cut of 25 basis points with another to follow in August.
NAB is the only bank to be expecting three cash rate cuts in 2027, starting in June.
Westpac sees the first 25-basis point cut coming in August 2027 while ANZ is tipping September.
As term deposit products have their rates set to apply to a future payout, falling rates indicate banks are expecting interest rates to drop and funding costs to ease during that period.
The Reserve Bank of Australia's next meeting on the cash rate is scheduled for 28-29 September with markets currently pricing in a 0% chance of a cash rate hike next month.
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Want to earn a fixed interest rate on your cash? The table below features term deposits with some of the highest interest rates on the market for a six-month term.
| Bank | Term Deposit | Interest Rate | Interest Frequency | Term | Automatic Rollover | Maturity Alert | Early Withdrawal Available | Minimum Deposit | Maximum Deposit | Notice Period to Withdraw | Account Keeping Fee | Online Application | Joint Application | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.35% p.a. | At Maturity | 6 months | $5,000 | $19,999 | – | – | |||||||||||||
5.20% p.a. | At Maturity | 6 months | $10,000 | $5,000,000 | – | – | |||||||||||||
5.15% p.a. | At Maturity | 6 months | $1,000 | $1,000,000 | – | – |
