ANZ, CBA, NAB & Westpac have all cut term deposit rates this month

William Jolly By on August 16, 2019
 
ANZ headquarters

Photo source: ANZ

The lack of a cash rate cut in August hasn’t stopped some of Australia’s largest banks from lowering term deposit rates, with each of the big four slashing rates for fixed-rate savers.

The big four have cut various term deposit rates by up to 45 basis points between them at the halfway point in August:

  • ANZ has dropped term deposit rates by as much as 25 basis points
  • Commonwealth Bank has lowered (and also raised) various term deposit interest rates by up to 45 basis points
  • NAB has decreased term deposit rates by as much as 10 basis points
  • Westpac Group has cut term deposit rates by up to 20 basis points: this includes related companies St. George, BankSA and Bank of Melbourne’s

Data released from the Reserve Bank earlier in August showed the average term deposit rate from the big four banks (plus Macquarie) in July fell to a new record low of 1.50% p.a.

In June it was higher at 1.60% p.a., but this figure should fall even lower next month when the data is released showing the effect of July’s RBA rate cut.

At the moment, some of the highest term deposit rates available from the big four are now well-below 2.00% p.a.

Company Advertised 1-year rate Advertised 3-year rate Advertised 5-year rate  
ANZ 1.70% 1.65% 1.70% More details
CBA 1.60% 1.55% 1.60% More details
NAB 1.75% 1.65% 1.75% More details
Westpac 1.75% 1.70% 1.70% More details
Advertised 1-year rate Advertised 3-year rate Advertised 5-year rate
ANZ
1.70% 1.65% 1.70%
More details
CBA
1.60% 1.55% 1.60%
More details
NAB
1.75% 1.65% 1.75%
More details
Westpac
1.75% 1.70% 1.70%
More details

*Rates correct as at 16 August, 2019. Rates based on a $50,000 deposit.

Who else has cut interest rates?

Interest rates on savings accounts have remained stagnant so far in August after a slew of rate cuts last month, but the same can’t be said for term deposits, with several dozen banks lowering their term deposit rates this month.

The size of these changes varies significantly, ranging from as little as one or two basis points to as many as 64 basis points (Gateway Bank) from smaller institutions.

The key changes Savings.com.au has found include the following:

  • Macquarie Bank decreased term deposit rates by 15 basis points
  • ME decreased term deposit rates by up to 20 basis points
  • UBank decreased term deposit rates by up to 10 basis points
  • Suncorp decreased term deposit rates by up to 15 basis points
  • AMP decreases term deposit rates by up to 10 basis points
  • Bank of Sydney decreased term deposit rates by up to 10 basis points
  • Newcastle Permanent decreased term deposit rates by up to 25 basis points
  • Bankwest decreased term deposit rates by up to 20 basis points
  • CUA decreased term deposit rates by up to 25 basis points

After factoring in many of the term deposit rate cuts this month, the average interest rate across all terms and the majority of banks sits at just over 1.70% p.a.

The table below shows some of the highest one-year term deposit rates as of today.

High one-year term deposit rates

Company Advertised interest rate Interest
frequency
 
Firstmac 2.20% End of term More details
Bank First 2.15% Monthly, fortnightly, annually More details
Illawarra Credit Union 2.15% Annually More details
Firstmac 2.10% Monthly More details
Advertised interest rate Interest
frequency
Firstmac
2.20% End of term
More details
Bank First
2.15% Monthly, fortnightly, annually
More details
Illawarra Credit Union
2.15% Annually
More details
Firstmac
2.10% Monthly
More details

*Rates correct as at 16 August, 2019. Rates based on a $50,000 deposit.

In terms of future rate changes, numerous well-regarded economists, including those from big four banks like Westpac, predict at least two cuts to the cash rate in the coming months.

The exact timing of the cuts varies depending on who’s being asked, but Westpac’s Bill Evans predicts 25 basis point cuts in October 2019 and February 2020.

If he’s correct, this would take the cash rate down to 0.50%, and term deposit rates could soon follow.

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In the interests of full disclosure, Savings.com.au and loans.com.au are a part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links. 

William Jolly
William Jolly joined Savings.com.au as a Financial Journalist in 2018, after spending two years at financial research and comparison website Canstar. In William's articles, you're likely to find complex financial topics and products broken down into everyday language. He is deeply passionate about improving the financial literacy of Australians and providing them with resources on how to save money in their everyday lives.
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