Maybank launches online foreign currency deposits

MAYBANK has launched a new range of online foreign currency time deposits aimed at savers who want high interest rates without locking up large amounts of cash.

The six-month iSAVvy Foreign Currency Time Deposit - available in five currencies - requires a minimum investment of 10,000 units of the chosen currency, but pays interest at rates usually reserved for deposits 10 times larger.

Small savers stand to benefit most from the offering. All major banks here, including Maybank, pay different rates on deposits of different sizes, with larger deposits attracting higher rates. But the new online foreign currency deposits pay a flat rate equivalent to Maybank's highest tier of rates - those paid on deposits of 100,000 or more units of foreign currency.

As of yesterday, the rates offered on new deposits were 4.88 per cent for US dollars, 5.12 per cent for sterling pounds, 5.87 per cent for Australian dollars, 7.35 per cent for New Zealand dollars and 3.5 per cent for euros.

The rates are 0.2 of a percentage point higher than the bank's rates for equivalent conventional deposits for amounts of less than 50,000 currency units. The bank said the interest rates and preferential exchange rates for new deposit placements will be available for a 'limited launch period'. When asked, a spokeswoman at the bank said no time period had been specified yet.

The promotional interest rates also compare favourably with those offered by other banks here. A check by BT last night showed that five other banks - DBS Bank, OCBC Bank, United Overseas Bank, Citibank and HSBC - offer rates of between 3.31 per cent and 4.66 per cent for six-month US dollar deposits below US$50,000 and between 3.71 per cent and 4.72 per cent for deposits of at least US$50,000 but less than US$100,000. But the minimum deposit requirements at the three local banks are lower, starting at the foreign currency equivalent of just $5,000 at DBS.

Foreign currency deposits are attractive to some investors because interest rates in countries such as New Zealand are now much higher than in Singapore. But saving in a foreign currency exposes a person to the added risk that the exchange rate may change unfavourably, reducing the Singdollar value of their savings.

The foreign currency time deposits are the latest addition to Maybank's iSAVvy series of online banking products, which include savings accounts and Singdollar time deposits for maturities up to 12 months.

'Since the introduction of our iSAVvy series of online deposits, we have recorded a 20 per cent growth in the number of new bank customers who place deposits online,' said Helen Neo, Maybank's head of consumer banking in Singapore. 'There is also a rising trend of customers investing in foreign currencies. The total deposit size of our foreign currency time deposits has nearly doubled over the past three years.'

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