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Commonwealth Bank has announced it will increase savings rates, while Westpac, NAB and ANZ will bump up some of their term deposit rates.
The Reserve Bank of Australia (RBA) has raised the official cash rate for the second time this year, in a bid to combat rising inflation. The central bank announced a 50 basis point hike, taking the cash rate to 0.85%. This is the biggest cash rate rise in 22 years and the first back-to-back rise in over 12 years.
We’re tracking how the big four and other financial institutions on our database respond to June’s cash rate announcement, and what it could mean for your savings. We’re also keeping track of home loan rate changes.
Commonwealth Bank
Commonwealth Bank will increase the bonus interest rates on its GoalSaver and Youthsaver savings accounts by 0.50 percentage points, taking the total rates to 0.75% and 0.95% respectively. The changes will take effect on 17 June 2022.
CommBank will also “extend the availability” of its 18-month term deposit special offer of 2.25%.
Westpac
Westpac will increase the interest rates on its 12 to 23-month term deposits to 2.25%. This offer will be available from 9 June 2022 and available on deposits of $5,000 to $5,000,000, with interest paid monthly or at maturity. Westpac has not announced changes to its savings accounts at the time of writing.
NAB
NAB will be offering a special 12-month term deposit interest rate of 2.25%. It will be available from 17 June 2022. NAB has not announced changes to its savings account rates at the time of writing.
ANZ
ANZ will offer a new rate on its 11-month Advance Notice term deposit of 2.25%. This change will come into effect on 13 June 2022. ANZ has not yet announced changes to its savings account rates but says they are being reviewed.
What does this mean for your savings?
Only Commonwealth Bank has announced increases to its savings account interest rates thus far. We’ve calculated the amount of additional interest you could earn in a year on $10,000 in a savings account, as a hypothetical example.
CommBank’s GoalSaver currently offers a 0.25% interest rate. On a $10,000 balance, this rate would earn you $25.03 a year, or $2.08 a month
When the savings rate increases to 0.75%, you could earn around $75.26 a year, or $6.25 a month. Note that the yearly figures are slightly higher than 12 equal monthly instalments would be, due to compound interest.
Bonus savings accounts
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| Current rate | Increase | Effective | Increase to monthly interest earned |
New monthly interest earned |
|
|---|---|---|---|---|---|
| CommBank GoalSaver |
0.25% | 0.50 percentage points | 17 June 2022 | $4.17 | $6.25 |
| Westpac Westpac Life |
0.50%, or 2.00% (for 18-29 year olds) |
– | – | – | – |
| NAB Reward Saver |
0.50% | – | – | – | – |
| ANZ Progress Saver |
0.40% | – | – | – | – |
Source: www.canstar.com.au – 09/06/2022. Current rates based on bonus savings accounts available for an amount of $10,000. A bonus savings account is one where you may have to meet certain conditions – such as growing your balance or not making too many withdrawals – each month in order to earn the full rate of interest.
Promotional savings accounts
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| Current rate | Increase | Effective | Increase to monthly interest earned |
New monthly interest earned |
|
|---|---|---|---|---|---|
| CommBank NetBank Saver |
0.50% for 5 months, then 0.30% |
– | – | – | – |
| Westpac eSaver |
0.50% for 5 months, then 0.05% |
– | – | – | – |
| NAB iSaver |
0.55% for 4 months, then 0.05% |
– | – | – | – |
| ANZ Online Saver |
0.15% for 3 months, then 0.05% |
– | – | – | – |
Source: www.canstar.com.au – 09/06/2022. Current rates based on promotional savings accounts available for an amount of $10,000. A promotional savings account is one where the full interest rate is only available for a limited time, before the account reverts to a lower rate.
If you want to boost your savings even further, consider switching to a high-interest savings account.
At the time of writing, the best ongoing interest rate on Canstar’s database for savers of all ages is 1.35%. This is offered by AMP, ING, MOVE Bank and ubank. This excludes accounts with promotional rates and accounts where savings are not available at call, but includes bonus savings accounts. Additionally, ING has announced that it will soon increase its popular Savings Maximiser account by 0.75 percentage points, taking the total bonus rate to 2.10% for eligible customers. We’ve covered this and other savings announcements in more detail below.
Alternatively, all of the major banks will soon be offering term deposits with rates of 2.25%, and some institutions on our database offer higher rates still. Bear in mind that while you can often find a higher rate on a term deposit than you could on a savings account, term deposits also generally come with the drawback of not being able to access your money before the end of the specified term without incurring a penalty. It’s up to you to decide whether the higher interest you could potentially earn is worth this possible penalty. You can contact the provider of any savings accounts or term deposits you’re considering for their full terms and conditions, and check out our comparison tools for savings accounts and term deposits to help you reach a decision.
What other banks have increased their savings rates?
Here’s what has been announced by other banks and financial institutions so far following the RBA’s June announcement. As many banks did not respond to the May cash rate increase, please note that any increases may be in response to a combination of the May and June cash rate increases.
Bank of Melbourne
Bank of Melbourne has announced a 2.25% term-deposit offer for 12 months. It will be available on 12- to 23-month term deposits from $1,000 to $5,000,000, with interest paid monthly or at maturity. This offer will be available from 9 June 2022. Bank of Melbourne is owned by Westpac, along with BankSA and St.George.
BankSA
BankSA will also offer a 2.25% term-deposit for 12 months. It will be available on 12- to 23-month term deposits from $1,000 to $5,000,000, with interest paid monthly or at maturity. This offer will be available from 9 June 2022.
Bankwest
Bankwest will increase the bonus interest rate on some of its savings products by 0.50 percentage points. This includes its Hero Saver, which will take the total interest rate to 1.20%, and its Easy Saver, which will take the total rate to 0.85%. The changes will come into effect from 17 June 2022.
Bendigo Bank
Bendigo and Adelaide Bank has announced it will increase the interest rate on its Reward Saver account by 0.50 percentage points. This will take the total rate to 1.25% for customers 30 years old or under and 0.95% for customers 31 years old or over. The change will come into effect on 17 June 2022.
BOQ
BOQ has announced it will increase a range of term deposit rates, including increasing its 12-month term deposit rate to 2.50%. The changes will come into effect on 10 June 2022.
ING
ING said it will increase interest rates across a range of its savings accounts and term deposit products, including a 0.75 percentage point increase on its Savings Maximiser savings account to a total of 2.10% for eligible customers. Rates on its Savings Accelerator account will rise by 0.30 percentage points for balances under $50,000, and 0.55 percentage points for balances of $50,000 or more. Finally, ING will also hike some rates across its range of term deposits, which will now include a 2.75% 12-month rate. The term deposit rate changes will be effective from 10 June 2022, while the savings account changes will be from 15 June.
Macquarie Bank
Macquarie Bank has bucked the trend by announcing it will increase the interest rate on its transaction account to match its savings account. The Macquarie transaction account will earn a 1.50% interest rate on balances up to $250,000. At the same time, Macquarie will also increase the base rate on its savings account by 0.50 percentage points to 1.50% on balances up to $250,000. These changes will come into effect on 17 June 2022.
ME Bank
ME Bank will increase its Savings Account bonus rate by 0.30 percentage points. This will take its maximum savings rate to 1.10%, made up of a 0.05% base rate and a 1.05% bonus rate. ME will also increase interest rates on a range of term deposits, including increasing its 12-month term deposit to 2.75%. The changes will come into effect on 9 June 2022.
MyState Bank
MyState Bank will increase its Bonus Saver account by 0.50 percentage points for new and existing customers, effective 15 June 2022. This will take its maximum savings rate to 1.60%. MyState Bank will also increase some of its term deposit rates, including increasing its 24-month term deposit to 3%.
Newcastle Permanent
Newcastle Permanent has announced it will increase interest rates on a number of term deposit offerings, including a special rate of 2.25% on a new 12-month term deposit. This will be effective 14 June 2022.
Qudos Bank
Qudos Bank will increase its savings accounts (excluding its general savings account) by 0.40 percentage points. This will apply to the bonus rate for the Bonus Saver and DIY Super Saver products. For the Bonus Saver account, the increase will take the maximum interest rate to 1.30%. The changes are effective 23 June 2022.
St.George
St.George has announced a 2.25% term-deposit offer for 12 months. It will be available on 12- to 23-month term deposits from $1,000 to $5,000,000, with interest paid monthly or at maturity. This offer will be available from 9 June 2022.
Suncorp
Suncorp will increase its Growth Saver account by 0.70 percentage points, taking the total interest rate to 1.30%. Suncorp will also introduce a new term deposit rate of 2.30% for 12 months. The changes will come into effect on 15 June 2022.
This content was reviewed by Sub Editor Tom Letts as part of our fact-checking process.
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