Great value term deposits get more popular
Almost half of our savings are now tied up in term deposits.
The minutes of the April Reserve Bank board meeting revealed just how important the old fashioned term deposit has become to savers and to the banks themselves.
“Bank deposits now accounted for more than half of banks' overall funding, with the share having increased from 40 per cent in 2007,” read the RBA minutes. “Within that, term deposits had risen from 30 to 45 per cent of the total,” reported the RBA board members.
“As a consequence of banks competing aggressively for term deposits, their cost had risen materially relative to the cash rate.”
Source: Courier Mail