ASB and term deposit rates

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nate

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Topic # 25220 15-Aug-2008 12:05

ASB term deposit rates are located here. What I can't understand is in the 10k-50k range, the 6 month and 9 month periods have the highest return. Wouldn't the bank want to hold on to your money for as long as possible, so the 12 month and 18 month should be the highest??

tonyhughes

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Reply # 157175 15-Aug-2008 12:10

Maybe over the longer terms the number of clients just isnt there, and they are focussing on the reality of where the revenue actually is (In what is probably a reasonably competitive space), rather than where they would like it to be... ?

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Filterer

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Reply # 157182 15-Aug-2008 12:35

More likely its just that they expect interest rates to start dropping in the next 12 months.....

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JoeBloggs

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Reply # 157206 15-Aug-2008 13:50

Bingo filterer. Those rates are terrible however. Kiwibank will give you 8.3% on their completely accessible online savings account. If you want to go term, there are far better options.

TinyTim

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Reply # 157207 15-Aug-2008 13:53

Yes, it depends on what they expect interest rates to do over that period. They don't want to be paying you high interest rates in 12 months time if they are only lending that cash back out at low rates.

nate

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Reply # 157222 15-Aug-2008 15:01

JoeBloggs: Bingo filterer. Those rates are terrible however. Kiwibank will give you 8.3% on their completely accessible online savings account. If you want to go term, there are far better options.

I fully agree, the majority of my savings are with RaboPlus - I'm certainly not doing this by choice, but for personal reasons have to put up with lower rates from ASB.

bazzer

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Reply # 157224 15-Aug-2008 15:10

nate:
JoeBloggs: Bingo filterer. Those rates are terrible however. Kiwibank will give you 8.3% on their completely accessible online savings account. If you want to go term, there are far better options.

I fully agree, the majority of my savings are with RaboPlus - I'm certainly not doing this by choice, but for personal reasons have to put up with lower rates from ASB.

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Nightwyrm

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Reply # 157256 15-Aug-2008 17:28

Couldn't it just be a simple reason such as... higher interest rate + longer period of time = more that bank has to pay out?

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Reply # 157294 15-Aug-2008 20:47

Ahh dude, the banks WANT your money, the more money and the longer for the better, they certainly aren't concerned about the total cost of using your money for a while, just how much money they can make per $1 of your money

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