Fixed deposits update for May 2021
A mixed bag. FNB, Capitec and Nedbank are offerring slightly better fixed deposit rates compared to April. About 20bps more compared to the previous month across most terms.
Interestingly, that is different to other banks & SARB where rates offered have fallen. AfricanBank's 5-year notably has dropped by 0.8%. Their effective annual rate is 8.45% for the 5-year fixed deposit. Same applies to SA Retail bonds, whose rates have been going upward and come down quite sharply during May. Their two- and three-year offer is lower by almost 0.8%. Whilst SA Retail bonds 5-year temr has only dropped by 0.2%. This means, whilst AfricanBank's fixed deposit is still the best, it is only marginally so. Given the option to choose between AfricanBank's 8.45% and SA Retail Bonds 8.42% effective 5-year annualised rate, it is clear that SA retail Bond is the better to choose here.
AfricanBank - let us go back 12 months to April 2020 and compare AfricanBank's rates to rates on offer now. One year - or 13 months ago to be exact - we were in full lockdown. Fixed Deposit rates however were super attractive.
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All rates are sourced directly from the banks' websites and converted to effective annual rates in order to make comparisons fair.
Have a great week Walter