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Bank Deposit Compensation Scheme:
Australian Bank Deposits

The current compensation scheme covering Australian bank deposits protects depositers upto the value of $250,000 AUD should the bank be unable to meet it's financial obligations.

WARNING! - Any bank deposits in excess of the set Government compensation scheme are at very high risk should the bank go in to financial difficulties. Simply put - you could lose 100% of your deposit(s).  RIO strongly recommends that members do not take this risk, especially since banks are offering little reward for the degree of risk taken by you (the depositer).

To quantify this risk, it is possible you could sustain a 100% loss versus set bank deposit return 4%- Risk/Reward ratio very poor! Why take the risk if you don't need to?

Recommendation; firstly check that your bank is covered by the compensation scheme if not move banks. Secondly should any member have bank deposits in excess of government compensation scheme they should open a second account, this must be at another bank to enable multiple instances of compensation.

It is important to make sure that the bank chosen isn’t owned by or a subsidiary of the bank you already have deposits with. For any member with large amounts of cash on deposit firstly this is not recommended for several reasons, the main reason being that the purchasing power of the physical money depreciates over time. For those who simply prefer having large amounts in cash on deposit then at least protect your capital, by diversifying such deposits to several unconnected bank accounts also ensuring that each deposit remains below the set compensation scheme level at least you've done your part to protect the basic capital. Not to do so would be simple disrespect for money and plain ignorance.

Capital Protection Products Vs. Australian Bank Deposit Accounts

Product Capital Protection Investment Term Annual Interest
RIO Fixed Income Bond
100%
5 Years
(Interest Paid Quarterly or bi-annualy)
7%
Highest Interest Australian Bank
Limited 0% over $250k AUD
1 Year
4.61%

There is a world of difference in Bank deposit versus the RIO Fixed Income Bond in terms of both Risk and reward.

Bank deposit

Bank guarantee is limited to that set by regulatory authorities in Australia which is currently set at $250,000 AUD, as such capital over this amount is not protected and at Risk. (risk/reward very poor).

Specifically designed for small lump sum, bank deposits are usually facilitated via high street banking. (banks are exposed to risk by nature of their business) Risk/Reward ratio poor

When contemplating retirement you should not expose capital to significant risk as such bank deposit accounts holding large sums for retirement may not be wise and could be disastorous.

RIO Fixed Income Bond Series 2 (Improved Surety)

With the RIO Fixed Income Bond 100% of capital is guaranteed / no risk to capital.

The bond returns 7% before tax, however tax can be mitigated completely in many circumstances should you require information on this process we are happy to provide information.

Based in Sterling conversion from AUD to Sterling currently represents (12th March 2013) real value and a currency gain can be expected on top of 7% pa fixed return for the fixed period being 5 years.

Designed for retirement and large lump sum investments, by nature this type of vehicle bares no risk to capital and offers 100% protection - combined with a fixed return for fixed period. (risk/reward ratio Excellent)

Current Australian Bank Deposit Rates

Deposit Account Type Term APY Account Details
UBank 1 Year Term Deposit 1 year 4.61% The interest rate for this Uba...- AUD - Mar, 2013
CBA 5 Year Term Deposit 5 year 4.60% This rate requires an investm...- AUD - Mar, 2013
AustralianSuper 1 Year Term Deposit 1 year 4.55% The rate is applicable to the ... - AUD - Mar, 2013
ING Direct Australia 1 Year Term Deposit 1 year 4.50% The Interest Rates for this 12...- AUD - Mar, 2013
Westpac 2 Year Term Deposit 2 year 4.35% Rate is applicable for deposit...- AUD - Mar, 2013
Bankwest 1 Year Term Deposit 1 year 4.35% The 12 month / 1 year term d...- AUD - Mar, 2013
Credit Union Australia 1 Year Term Deposit 1 year 4.35% This CUA interest rate p.a ind...- AUD - Mar, 2013
NAB 2 Year Term Deposit 2 year 4.30% Main Rate is applicable for a ...- AUD - Mar, 2013
ANZ 2 Year Term deposit 2 year 4.30% Rate is available for amounts... - AUD - Mar, 2013
Suncorp Bank 1 Year Term Deposit 1 year 4.30% Interest Rate for this Suncorp...- AUD - Mar, 2013
BOQ 1 Year Term Deposit 1 year 4.25% BOQ / Bank of Queensland Term ... - AUD - Mar, 2013
CBA 1 Year Term Deposit 1 year 4.20% - The investment requires a mi... - AUD - Mar, 2013
NAB 1 Year Term Deposit 1 year 4.20% Main Rate is applicable for a ...- AUD - Mar, 2013
Macquarie Bank 1 Year Term Deposit 1 year 4.20% The rate applicable is for a 1...- AUD - Mar, 2013
ANZ 1 Year Term deposit 1 year 4.15% Main Rate is available for amo... - AUD - Mar, 2013
ANZ 6 Month Term deposit 6 month 4.15% The product is for a 6 month t...- AUD - Mar, 2013
CBA 3 Month Term Deposit 3 month 4.15%  For investments of $50,000 to... - AUD - Mar, 2013
St George Bank 1 Year Term Deposit 1 year 4.15% The following interest rate ap...- AUD - Mar, 2013
Bank of Melbourne 1 Year Term Deposit 1 year 4.15% The current interest rate for ... - AUD - Mar, 2013
Bank SA 1 Year Term Deposit 1 year 4.15% The interest rates applicable ...- AUD - Mar, 2013
Rural Bank 1 Year Term Deposit 1 year 4.15% The interest rate applicable f...- AUD - Mar, 2013
Bendigo Bank 1 Year Term Deposit 1 year 4.15% The interest rate for this one... - AUD - Mar, 2013
Westpac Business Term Deposit 1 year 4.15% The account requires a minimum... - AUD - Feb, 2013
ANZ 3 Month Term deposit 3 month 4.10% 90 day or 3 month Rates are fo... - AUD - Mar, 2013
NAB 6 month Term Deposit 6 month 4.10% Rate is applicable for deposit...- AUD - Mar, 2013
Westpac 1 Year Term Deposit 1 year 4.05% Rate is applicable for a the p...- AUD - Mar, 2013
Westpac 6 Month Term Deposit 6 month 4.05% Rate is applicable for deposit...- AUD - Mar, 2013
NAB 3 Month Term Deposit 3 month 4.00% Rate is applicable for Amounts... - AUD - Mar, 2013
Westpac 3 Month Term Deposit 3 month 3.00% Rate is applicable for a the p...- AUD - Mar, 2013
NAB 1 Month Term Deposit 1 month 2.90% ... - AUD - Mar, 2013
Westpac 1 Month Term Deposit 1 month 2.90% The following deposit interest...- AUD - Mar, 2013
 



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