Bankwest has backed up its threat of taking on the nation's Big Four banks and yesterday pulled the price lever by launching the nation's highest interest-rate saving product.
The new BankWest Regular Saver Account, which comes less than a month after the bank's owner, HBOS Australia, announced an aggressive east-coast expansion, will offer an 8 per cent interest rate - 2.4 percentage points above its closest rival Rabobank at 6.6 per cent.
The high-yielding account is expected to be the first in a line of "better deal" banking products the bank will be rolling out over the next few months across retail deposit, credit card and mortgage products and will be accompanied with a marketing blitz.
"It's time the Australian banking and finance industry took savings seriously and BankWest is reinvigorating this space and leading the charge once again," BankWest's head of deposits, Paul Vivian, said.
"We do have some other products up our sleeve that we will be releasing later this year", Mr Vivian said, while pointing to credit cards, mortgages and savings as its primary focus. Earlier this month, HBOS Australia launched a $430 million-plus assault on the Big Four banks, with plans to roll out 160 branches across the east coast over the next three years. About 3000 jobs are expected to be created.
At the time of the launch, HBOS Australia chief David Willis warned that it hoped to win customers from the Big Four by being price competitive and introducing new products.
Outgoing Westpac chief David Morgan last week said BankWest's expansion "needs to be taken seriously and I think they will in time take some share".
Analysts are predicting the Big Four banks will take some hit on their cash earnings.
Mr Vivian said the BankWest Regular Saver Account was a long-term sustainable offer.
He said the 8 per cent rate was "pitched out there very purposely to be significantly better than any other savings rate in the marketplace".
"We would love to take customers and money off the Big Four banks," he said.
"There's some very lazy money currently (put) in products with the Big Four. It's time for customers to have a look at what their earnings on their term deposits are, what their earning on their at-call savings are and we are confident we can offer better returns across the place."
BankWest's share of the deposit space is about 4 per cent.
To receive the 8 per cent interest rates, customers need to deposit between $50 and $500 in that month, make no withdrawals during that period and link the account to another eligible BankWest account.
