Singapore Dollar Fixed Deposit/Time Deposit

[BillyB]

if you want return, I would avoid the Singapore banks. Pretty minimal chance of the larger Malaysian banks defaulting in my opinion, and even if they had problems, would be surprised if the Singapore govt let Singapore retail investors suffer large losses.

True, you're going make less of a 'real' loss if you stuck your money with a Malsysian bank; but inflation in MY is still at 2.7%.....

[stiwi]

[...]
TL - To answer your question about the "lesser" banks offering better rates. This is because they're not tier 1 banks and according to my source they are not monitored as closely as the local banks by the MAS. Hence you're paying a "premium" for the increased likelihood that they'll go under. As your amount is S$20k it is covered by the Singapore Deposit Insurance amt, so this should to some extent cancel out the risk.
[...]

As you mentioned about Singapore Deposit Insurance, I personally find it odd that financial hub such as Singapore has such deposit insurance set quite low. It was S$20,000 and now is S$50,000 excluding foreign currency accounts... So if you have foreign currency and bank will fail, you get nothing. I know that Singapore has never had any banking failure but...

US for instance has US$250,000 while all EU countries have at least €100k (Ireland unlimited) regardless of the currency that you are holding.

[JR8]

I'm not surprised.... SG has like 15% aggregate income tax rate for most people, America, EU, Ireland etc, what about 40%?

No scheme of consumer protection or rights is free.... so which would you prefer!

[zzm9980]

I'm not surprised.... SG has like 15% aggregate income tax rate for most people, America, EU, Ireland etc, what about 40%?

No scheme of consumer protection or rights is free.... so which would you prefer!

disclaimer: I used to work here if you didn't guess by the end.

Funny enough, US deposit insurance is provided by the FDIC, a pseudo-government agency/spin-off like the US Post Office. They get zero dollars from the US Government, and are entirely funded by the premiums they charge to the banks they insure. Their 'fund' was so large that as of about ~2002 (when I was there) they had even collected premiums for 5+ years, and instead were investing and growing their fund on their own, and living off the growth. I'm not sure if they had to start collecting premiums again or not after a lot of small banks failed in '08. I think they actually just kept a percentage of what they made auctioning off the little guys to the big guys to replenish their expenditures.

But anyway, yeah, not a dollar of tax payer funding goes into there.

[JR8]

^^^ Most interesting

[AndyWillie]

Update of the rates (SGD$20k, 12 months tenor)
Citi: 0.100%
DBS/POSB fixed deposit: 0.0750%
HSBD: 0.19%
Maybank: 0.700%
RHB: 0.6250%
OCBC: 0.90% (promo rate*)
UOB: 0.2500%
StanChart: 0.350%

DBS/POSB, Maybank & OCBC have slight increases. The rest constant.

[JR8]

Very timely of you posting that, thanks.

(One of my relatives is a retiree and needs to find a place to park S$150k or so as to generate an income. As one might expect it needs to be pretty low risk. But looking at these bank rates, they really aren't going to much to help are they! {sigh}).

[v4jr4]

Update of the rates (SGD$20k, 12 months tenor)
Citi: 0.100%
DBS/POSB fixed deposit: 0.0750%
HSBD: 0.19%
Maybank: 0.700%
RHB: 0.6250%
OCBC: 0.90% (promo rate*)
UOB: 0.2500%
StanChart: 0.350%

DBS/POSB, Maybank & OCBC have slight increases. The rest constant.

Goodness

[the lynx]

Very timely of you posting that, thanks.

(One of my relatives is a retiree and needs to find a place to park S$150k or so as to generate an income. As one might expect it needs to be pretty low risk. But looking at these bank rates, they really aren't going to much to help are they! {sigh}).

No wonder people here rather take their chance in forex and property exchange... The bank rates are so unattractive...

[JR8]

No wonder people here rather take their chance in forex and property exchange... The bank rates are so unattractive...

Quite. Significantly less than inflation, so even in a bank deposit the value is going backwards.

[New_Global_Trader]

Hi.

As the banks in SG are paying less interest, they are also charging less interest on loans.

In India (from where I am), if banks are paying 9% annual interest, they are charging more than 13% on loans too.


Regards

[JR8]

Hi.

As the banks in SG are paying less interest, they are also charging less interest on loans.

In India (from where I am), if banks are paying 9% annual interest, they are charging more than 13% on loans too.

Regards

Maybe let's do a comparison, and you help fill in the blanks:

Singapore:
Bank deposit < 1%
Inflation 5.3%
Bank loan 12%+*

India:
Bank deposit 9%
Inflation ??
Bank loan 13%+


*
http://www.dbs.com.sg/personal/cashline ... s_cashline

[Mad Scientist]

One of the key thing why rates in SG is low are due to Government bonds that banks need to buy for security in case they go bust
Most banks are self funded and cash rich hence the COF i,e cost of fund is low and with local competition you need to stay low to survive
In India or many countries Home Loan against FD /TD disparity is due to overseas COF which depends greatly on the country credit rating in the wholesale market.
The ability to pay back with interest will reflect on this loan and FD comparison

[beppi]

Inflation in India is currently 10.0% (source:The Economist)
I don't thing you can get bank interest rates above inflation anywhere in the world right now!

[honodie]

when i first returned to sg, i was disappointed with the low rates too. my aud is getting much higher returns in a fixed deposit there. however, the problem comes in when now i am earning sgd and converting it, would inevitably lose some money.

about two months ago, i came across a company who sources for sound reliable, international property investment programs. Only those that pass their strict assessment would be marketed to Singapore.

for example, there is a one year program that pays out 15% fixed returns, all in sgd, and assures capital as they are all backed by asssets. This fixed percentage is stated in its legal contract.

if you are interested to know how they can achieve that, here goes:
Developer buys distressed property, adds value to it by basic renovation, sells it a little lower than market rate to ensure quick sale. Partners with mortgage brokers to ensure sales. Then he performs this cycle as many times as possible in one year. (he doesnt just earn 15% in one cycle)

Our capital goes into an escrow fund, managed by two parties, a lawyer and a trustee, who only releases the funds when the developer gives the title deeds in exchange. this basket of title deeds will be in our names. assuring our capital.

All parties involved have been audited and cleared. And this program has even been UK SIPP Approved.

So there can be other options available. It just depends on if you are open to explore options and will you then, seize opportunities.

cheers.