Deposits flow out as rates fall

Growth in household deposits is slowing, as savers move their money out of at-call and term deposits in search of higher rates. Some deposit-taking institutions are experiencing substantial outflows.

The Australian Prudential Regulation Authority's latest banking statistics show that the growth rate in household deposits for the 12 months to April was 7.6 per cent. It fell to an annualised rate of 4.8 per cent for the six months to April, and to 2.8 per cent annualised over the past three months.

APRA's data shows some very significant outflows. Over the three months to April, Macquarie Bank's household deposit book reduced by 19.4 per cent, Investec's by 7.1 per cent, Beirut Hellenic's by 7.1 per cent and RaboDirect's by 6.3 per cent.

Source: Banking Day