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Savings Slump: Westpac cuts up to 0.10% off savings account interest rates

Savings Slump: Westpac cuts up to 0.10% off savings account interest rates

Westpac group has today cut savings rates by up to 0.10 per cent even though the RBA left rates on hold last month.

Australia’s second largest bank now has a max savings rate of 1.91 per cent, for just five months.

Westpac rate changes

Savings accountOld max rateNew max rateConditions
Life1.95%1.90%Account balance must increase each mth
eSaver2.01%1.91%Max rate only for first 5 months. Ongoing rate is 0.15%

Westpac subsidiaries St George, Bank of Melbourne and Bank SA have also all shaved their savings account rates today also by up to 0.10 per cent.

Australians savers are facing tough conditions, with rates tumbling since the Reserve Bank made two back-to-back cash rate cuts in June and July.

There is strong speculation another rate cut will happen this year, which would likely result in more banks cutting interest rates for savers.

RateCity.com.au research director Sally Tindall said the banks didn’t have much more to cut before they hit zero.

“Savers who are used to being rewarded for making regular deposits will find that the bonus rates will start falling away if the RBA cuts again.

“If your bank has cut savings rates recently, its worth shopping around to find a better deal. Right now you can still find an ongoing rate of 2.50 per cent however this rate is unlikely to stick around for long,” she said.

Savings rates Big 4 banks vs market leaders

Big 4 banksMax rateConditions
CBA1.15%Mthly deposit of $200, no withdraw
Westpac1.91%Account bal must increase each mth
NAB1.86%Mthly deposit, no withdraw
ANZ1.95%Min mthly deposit of $10, no withdraw

Market leadersMax rateConditions
MyState Bank2.50%Deposit of $20, 5 transactions
Up2.50%5 card purchases from everyday acct
86 4002.50%Deposit of $1000 in everyday acct
BOQ2.50%Deposit of $1000 in everyday acct

Notes: Rates above are the banks’ highest ongoing rates. The rates are based on a balance of $25K. CBA offers higher rates for higher balance. Excludes kids accounts and introductory rates

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This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.



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