ANZ cuts savings account interest rates to lowest yet
photo by Debora Cardenas to Unsplash
ANZ has now thrown the ax on a number of its savings account, term deposit and home loan products.
Ahead of the Reserve Bank’s cash rate decision next month, ANZ preemptively reduced the interest rate on its popular Online Saver account.
The base rate was lowered from 0.10% pa to just 0.05% pa – the worst of the big four – bringing the total rate on the account (including the 3-month introductory bonus rate of 1.5 % pa) to 1.55% pa
This means that after three months of holding the account, ANZ savers would only earn 0.05% per annum, which is the worst current savings account rate among the Big Four.
An ANZ spokesperson said Savings.com.au their rates remain “competitive”.
âWe regularly review our rates and seek to balance the needs of our customers whenever we make changes, while remaining competitive. “
Compare this with some of the interest rates offered by neobanks like Xinja, which currently offer the highest non-initial savings account interest rate in the market at 2.25% per annum for their new “Stash” product. .
Xinja has already attracted over $ 30 million on its Stash savings account, despite launching just a week ago.
Xinja Bank founder and CEO Eric Wilson described it as a “ripper response” and said customer feedback showed how much support there was for a new way of doing banking.
âWe are committed to the long game of staying lean and reducing costs and overhead to do the best for our customers,â Wilson said.
âHaving happy customers will go a long way in helping us break the Australian bank’s high cost, high profit model. “
The table below provides an overview of some of the highest non-introductory interest rates on the market.
ANZ’s move follows in the footsteps of NAB, which last week cut interest rates on its savings accounts on its popular iSaver and Reward Saver accounts.
Off-cycle savings account rate cuts could suggest that banks are bracing for a potential RBA cash rate cut when they first meet this year in February.
Currently, markets are banking on interest rates falling nearly 60%, with many economists estimating the spot rate could drop to 0.25% by the end of the year.
The chances of a drop in the cash rate next month depend on the unemployment figures, which will be released later today.
ANZ also today reduced mortgage rates on its Simplicity Plus product (loan-to-value ratio of at least 80%) from 3.24% pa to 3.12% pa.
The bank also reduced its Simplicity Plus home loan for borrowers with LVR above 80% from 3.58% pa to 3.38% pa
Many ANZ term deposit rates were also cut by up to 10 basis points today. Its best term deposit rate is currently 1.15% pa for a standard five-year term deposit.