Maybank Singapore and Hong Leong Finance have raised promotional fixed deposit rates, and the best broadly available 12-month rate in Singapore stood at an effective 2.19% a year as of Oct. 26, according to a survey of bank offers by investment research site Beansprout.

For savers, the shift matters because fixed deposits have overtaken government paper. Maybank's 2.10% six-month deposit rate now beats the 1.95% cut-off yield at the latest six-month Treasury bill auction.

The top headline numbers carry conditions, however, and the gap between the most generous lenders and the largest local banks is wide.

What Maybank and Hong Leong Finance are paying

Maybank's best offer sits inside its Deposits Bundle promotion. The time deposit itself pays 2.40% for 12 months, but the bank requires customers to earmark an amount equal to 10% of the deposit in a Maybank savings or current account, which earns a base rate of 0.05%. Blending the two gives an effective return of 2.19%, Beansprout calculated, using a S$100,000 time deposit as its example. The minimum online placement is S$22,000.

Without the bundle, Maybank had raised its standalone rates and was paying 2.10% for both six and 12 months on S$20,000 or more, the survey showed. Its nine-month bundle rate of 2.25% worked out to an effective 2.05%.

Hong Leong Finance introduced a special promotion paying 2.08% for an eight-month term on fresh funds of S$20,000 and above, available at the counter and online. Its standard online rate for 12 months was 1.90% at that size, and 1.70% for balances of S$5,000 to just under S$20,000.

Other lenders near the top included HL Bank, which paid 2.15% for 24 months on S$10,000 through its HLB Connect app, the longest tenor with a rate above 2% in the comparison. RHB and CIMB each offered 2.10% for 12 months. Bank of China paid 2.05% for 12 months on S$20,000 via mobile banking, and up to 2.18% for four or eight months to new customers placing S$200,000 to S$250,000.

The three local banks lagged. OCBC paid 1.85% online for 12 months on S$20,000, UOB 1.70% for 12 months on fresh funds of S$10,000, and DBS/POSB 1.00% for nine or 12 months, capped at deposits below S$20,000, according to the survey. Larger DBS/POSB placements earned 0.05%.

How deposits compare with T-bills

The six-month Singapore T-bill cleared at 1.95% at the Oct. 22 auction, up five basis points from 1.90% two weeks earlier and the highest cut-off yield this year, Beansprout reported from Monetary Authority of Singapore auction data. Applications fell to S$16.1 billion from S$17.8 billion, while the amount allotted rose to S$8.6 billion.

That leaves Maybank's 2.10% six-month rate about 15 basis points ahead of the T-bill. The trade-offs differ. T-bills are Singapore government securities sold at auction, so the yield is not known until results are out. Fixed deposits lock money in for a set term, and promotional rates usually come with minimums, fresh-fund rules or account bundles that lower the true return.

Bank deposits are protected, within limits. The Singapore Deposit Insurance Corp. aggregates a depositor's insured deposits at each member bank or finance company and covers them up to S$100,000 in aggregate, Beansprout noted. Savers spreading larger sums across several promotions can keep each placement within that cap.

The rate backdrop

The rise in Singapore deposit rates follows a turn in global borrowing costs. The Federal Reserve raised rates in September for the first time since 2023, and on Oct. 28 (Oct. 29 in Asia) it held its target range at 3.75% to 4%. The Fed's post-meeting statement repeated that inflation remains elevated.

Beansprout tied the climb in T-bill yields to rising bond yields in the United States and globally. Beansprout said it refreshes its comparison weekly, and several of the offers listed are explicitly promotional, so rates can be withdrawn or cut without much notice.

Savers weighing a 12-month placement against rolling six-month T-bills should compare the effective rate after any bundle conditions, not the headline figure. The next six-month T-bill auction will show whether government yields keep pace with the banks.

This article is general information, not financial advice.