DBS Bank will cut rates further on its flagship deposit account from Aug 1, amid economic uncertainty.
The move comes after earlier rate revisions for the DBS Multiplier account kicked in on May 1.
The DBS Multiplier offers tiered interest rates that are stepped up if customers have more transactions and transact in larger amounts. The rate determined is then applied to the account balance.
The latest changes affect interest rates for account balances up to the first $50,000.
For example, if a customer credits an income stream - salary or dividends - into the Multiplier account and makes one more DBS transaction in an eligible category, valued at between $2,000 and $2,500 a month, the interest rate for the first $25,000 in the account balance will be halved to 0.7 per cent a year from Aug 1.
The current rate is 1.4 per cent. It was 1.55 per cent before May 1.
For customers who credit their income into the Multiplier account and make one more DBS transaction in an eligible category that adds up to at least $30,000, the rate on the first $25,000 will be cut to 1.3 per cent a year, from 2 per cent now.
Interest payouts for amounts where customers credit income and make two more DBS transactions in two separate eligible categories will also be cut.
For example, if a customer credits his income and makes two other transactions that add up to between $5,000 and $15,000, the interest rate for the first $50,000 in the account will be reduced to 1.8 per cent a year from 2.2 per cent now.
DBS has also expanded the types of qualifying dividends that count as an income stream. For example, it will accept dividends of equities listed in all markets, and the bank's unit trusts. It will also accept dividends credited into a Supplementary Retirement Scheme account or a CPF Investment Account.
OCBC Bank and Standard Chartered Bank announced plans last month to slash rates on savings accounts as of Wednesday.
Interest for StanChart's JumpStart account has been halved to 1 per cent for the first $20,000 - down from 2 per cent - and will remain at 0.1 per cent for balances above $20,000.
Interest on the first $80,000 in eligible deposit balances in StanChart's Bonus$aver accounts has been capped at 3 per cent a year as of Wednesday, down from 3.88 per cent on the first $100,000.
Other StanChart savings and current accounts have also had their prevailing interest rates revised to 0.05 per cent across the board.
The salary credit bonus interest for OCBC's 360 savings account has been halved to 0.6 per cent, from 1.2 per cent for balances up to $35,000. Balances of between $35,000 and $70,000 will now earn 1.2 per cent, down from 2.4 per cent.
OCBC has also stopped offering its credit card spend bonus interest, which was previously 0.2 per cent for the first $35,000 of balances and 0.4 per cent for the next $35,000.
THE BUSINESS TIMES