# Historic term deposit rates



## macfanboy (28 January 2010)

Looking at investing $100,000 soon at thinking of playing it safe with term deposit.
Is there a place where I can find historic monthly 1Y,2Y etc Term deposit rates so I can make a more informed decision?


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## Krusty the Klown (28 January 2010)

I don't know if you'll find something like this, as all institutions have different rates at different times.

There may be an an annual average somewhere.

It might be easier to look at RBA target rates over history.


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## Julia (28 January 2010)

Why do you consider historical rates to be relevant to a term deposit you intend making now?


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## drsmith (28 January 2010)

NAB and Westpac through subsidiaries were offering 6.8% for 12 months late last year.


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## Julia (28 January 2010)

drsmith said:


> NAB and Westpac through subsidiaries were offering 6.8% for 12 months late last year.



Westpac and St George - 8% for five years.
Suncorp matched this on request on basis of fairly large sum.
The best CBA would do at the same time (about two weeks ago) was 7.2%.
It just depends on how much any bank is seeking depositor funds at the time.


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## Wysiwyg (28 January 2010)

Julia said:


> Westpac and St George - 8% for five years.
> Suncorp matched this on request on basis of fairly large sum.
> The best CBA would do at the same time (about two weeks ago) was 7.2%.
> It just depends on how much any bank is seeking depositor funds at the time.




I wonder where these banks are investing to cover paying term deposit interest, business expenses and still turn a profit?


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## seamisty (28 January 2010)

drsmith said:


> NAB and Westpac through subsidiaries were offering 6.8% for 12 months late last year.



 I got 6.8% interest paid monthly for 12 months from Westpac. I had to work hard to get the monthly interest as they were only offering the 6.8% ON MATURITY. Cheers, Seamisty


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## macfanboy (29 January 2010)

Julia said:


> Why do you consider historical rates to be relevant to a term deposit you intend making now?




Well Term deposit rates like interest rates generally go up and down according to the economy. I would like to know if i am on a down or up.
Also, if 8% was the highest for the last 5-6 years then the current 8% for 5 Year Term Deposit would be ok.


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## macfanboy (29 January 2010)

Well I found this http://203.34.60.68/Statistics/AlphaListing/alpha_listing_i.html
Which shows you statistical data from the reserve bank of australia's interest rates under the heading of Interest Rates - Term Deposits - Retail Deposit and Investment Rates - F4 

This, depending on exactly what it represents, may be useful.
Would have to look at 1992 onwards though as pre was a bit of a once in a lifetime hiccup...


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## matty77 (29 January 2010)

I thought you would have been more concerned about comparing it to other $ investments and then deciding on your "risk reward" for a term deposit. Dont get me wrong a term deposit might suit you perfectly in this situation.


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## Krusty the Klown (29 January 2010)

macfanboy said:


> This, depending on exactly what it represents, may be useful.
> Would have to look at 1992 onwards though as pre was a bit of a once in a lifetime hiccup...




Well done.

Not only that but from the distant memory of my formal studies, I remember that pre 1980's banking deregulation, interest rates from banks were set by the legislators or the Reserve Bank - not the individual banks. So market forces were not a factor.

I'm a Gen-Xer, so did not experience that first hand so could stand to be corrected.


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## Sir Burr (28 March 2010)

Bank of Cyprus has a 5 year effective rate at 8.19%
http://www.canstar.com.au/interest-rate-comparison/compare-100k-term-deposit-rates.html

Wonder how safe it is being so close to Greece!


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## So_Cynical (28 March 2010)

Sir Burr said:


> Bank of Cyprus has a 5 year effective rate at 8.19%
> http://www.canstar.com.au/interest-rate-comparison/compare-100k-term-deposit-rates.html
> 
> Wonder how safe it is being so close to Greece!




LOL close to Greece  there site says 7.9% Interest paid on maturity..alot can happen in 5 years and im thinking you would have to have alot of money and be super conservative to lock up so much money for such a long time for so little return...IMO

There's probably over 100 stocks giving a better % return...there's even funds with no debts giving better returns, paid 6 monthly and mostly with franking credits....lol at the super conservative.


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## Largesse (28 March 2010)

the opportunity cost of locking your money up for 5 years has surely got to be higher than the return your getting at 8.xx%


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## SteeleBryant (28 March 2010)

Of course if you lock up your money for that long you won't be able to get into any investments that may come along. With that sort of money I wouldn't lock it away for anything under 8%. Considering inflation is pretty high at the moment and interest rates are on the way up.


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## Sir Burr (28 March 2010)

So_Cynical said:


> There's probably over 100 stocks giving a better % return...




Yeah just ran a scan on:

Dividend Yield (%)
10.00 - 50.00
8.00 - 10.00

There are a few...
http://www.ascii-data.com/cgi-bin/searchntay.cgi?sort=div_yield&61=10%7C50&62=8.00%7C10.00

69 over 8%


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## jaydebono (28 March 2010)

Wysiwyg said:


> I wonder where these banks are investing to cover paying term deposit interest, business expenses and still turn a profit?




I believe they lend it out, but they lend each dollar to 4 different people.

so 100k is lent to 4 different people who pay 5-6% each on there mortgage.

They'd clear a 12% profit if they lent it to 4 people at 5% each whilst paying the person funding the loans 8%.


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## boofhead (29 March 2010)

jaydebono said:


> I believe they lend it out, but they lend each dollar to 4 different people.
> 
> so 100k is lent to 4 different people who pay 5-6% each on there mortgage.
> 
> They'd clear a 12% profit if they lent it to 4 people at 5% each whilst paying the person funding the loans 8%.




Can you show how that works? From some simple calculations it seems 5% on 25K for each person would still be a combined 5% on 100K if done concurrently.


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## jaydebono (29 March 2010)

boofhead said:


> Can you show how that works? From some simple calculations it seems 5% on 25K for each person would still be a combined 5% on 100K if done concurrently.





Hi boofhead,

The banks actually lend out each dollar to multiple people. 

So in this case it would be 5% on 100k X 4 = $20k 

Then from that they pay the interest to the lender (term deposit @ 6%), so $20k - $6k = $14k profit.


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## Go Nuke (29 March 2010)

macfanboy said:


> Looking at investing $100,000 soon at thinking of playing it safe with term deposit.
> Is there a place where I can find historic monthly 1Y,2Y etc Term deposit rates so I can make a more informed decision?




I wouldn't rush into it.
Everything I keep hearing is about how great the Australian economy is, meaning interest rates will just go up and up.

Funny thing is though...Ive yet to find anyone who thinks the economy  (or individuals) are going great guns!


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## Sir Burr (1 April 2010)

jaydebono said:


> Hi boofhead,
> 
> The banks actually lend out each dollar to multiple people.
> 
> ...




25,000 x 5% = $1250
25,000 x 5% = $1250
25,000 x 5% = $1250
25,000 x 5% = $1250

100000 X 5% = $5000


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