- Australians are losing out with inferior savings interest rates -
- BankWest TeleNet Saver continues to lead the market -
Australians could be missing out on a staggering $6.3 billion in potential interest earnings per annum by accepting savings accounts that pay inferior interest rates, according to BankWest estimates released today.
The missed interest earnings of $6.3 billion is based on the difference between the estimated annual interest paid by Australian banks for household deposits, using figures from the Australian Prudential Regulation Authority and the Reserve Bank of Australia, and the total interest that would be paid in the first 12 months if every Australian saver used a BankWest TeleNet Saver.
The BankWest TeleNet Saver account offers a variable rate of 6 per cent p.a. for the first 12 months, with interest paid monthly, no fees and no minimum balance. BankWest Retail Head of Deposits Mr Paul Vivien said it was time for Australians to take action and to ensure that they are getting a decent rate of return on their savings.
"We are urging all Australians to seek out a better deal for their savings and to find a high interest savings account, such as the
BankWest TeleNet Saver, to be sure that they are getting their fair share of the possible $6.3 billion (over the 12 month intro period) that is currently being missed."
Paul said that 18 months after its launch the TeleNet Saver continues to lead the market, despite critics suggesting that the product was unsustainable.
"We have watched as others have followed our lead with the introduction of online savings products, albeit none are as compelling as the TeleNet Saver," Mr Vivien said.
Discussing BankWest's Eastern States growth strategy, BankWest Retail Chief Executive Mr Chris Whitehead said BankWest still had a lot of work ahead to drive change in the Australian banking market.
"BankWest has proved that its low cost business model and unwavering commitment to its strategy is sustainable," Mr Whitehead said.
"Eighty seven per cent of TeleNet customers have come from the Eastern States, with the majority of customers switching from the largest Australian banks," he said.
The $6.3 billion of missed interest is an estimate only, based on publicly available figures from the Australian Prudential Regulation Authority and the Reserve Bank of Australia, average interest rates and tiers of retail deposit accounts (including online accounts) of eleven banks plus the RBA average retail deposit rate and on BankWest assumptions. A full explanation of the methodology used to calculate this estimate is available on request.
"The bottom line is that the change we have helped to drive and the increased competition that we have embraced is all positive for the customer. But this new estimation of missed interest proves there is still a long way to go."
The BankWest TeleNet Saver was awarded Best New Product 2005 by Australian Banking & Finance magazine. The TeleNet Saver is available via telephone (13 17 20) and the Internet (www.abetterdeal.com.au).
The Reserve Bank estimates that the average interest offered by Australian banks for Cash Management accounts is 2.65 per cent p.a.; the average interest offered for 'bonus' savings accounts is 3.65 per cent p.a.; the average interest paid for one year term deposits is 4.4 per cent p.a.; while the average paid for online savings accounts is 5.45 per cent p.a.
Further information:
John Gardner
Ogilvy PR
02 8281 3237/ 0413 355 997
Ray Jordan
HBOS Australia, Corporate Affairs
08 9449 6305 / 0417 991 172
Notes to Editor:
BankWest TeleNet Product Overview
· Available via the Internet (www.abetterdeal.com.au) or telephone (13 17 20).
· There are no bank fees and no interest tiers.
· Joint accounts are available.
· The product disclosure statement for these products should be read by customers prior to opening an account.
· The Product Disclosure statement is available from the website www.abetterdeal.com.au
TeleNet Saver
· TeleNet Saver has an introductory variable rate of 6%p.a. for new customers for the first 12 months; following this introductory period the interest rate reverts 5.5% p.a.. Rates are subject to change.
· Interest is paid monthly.
· There is no minimum opening deposit, and there is a maximum investment limit of $1 million.
· A regular savings plan can be set up on the account.
About BankWest
BankWest (AFSL 236872) is a full service bank which originated in Western Australia in 1895 and services more than 660,000 customers. Nationally, BankWest promotes a range of products using cost effective direct and third party distribution channels, including 24-hour telephone and internet services and mortgage brokers.
In WA, BankWest is a market leader with about one quarter of all bank advances and deposits and an extensive network of branches.
BankWest is a wholly owned subsidiary of HBOS plc, is one of the world's largest financial services groups, with assets of about AUD$800 billion (£380 billion). Standard & Poors short-term credit rating for BankWest is "A-1" and "A+" for the long term, providing customers with investment grade security.
