SINGAPORE – Interest rates for fixed deposits are moving up and are now at the same or even higher than pre-Covid-19 levels amid an increasingly competitive market for lenders.

UOB and Hong Leong Finance are the latest to lift rates.

UOB is increasing promotional rates for its Singapore dollar fixed deposits from Thursday with a minimum placement of $20,000.

The rate for the 10-month tenor will be raised by 0.8 percentage points to 2.4 per cent while the 12-month tenor stays at the prevailing promotional rate of 2.6 per cent a year. Ms Jacquelyn Tan, head of group personal financial services at UOB, said the bank recorded a 16 per cent increase in its fixed deposit portfolio for the first seven months of this year.

Hong Leong Finance also announced a special fixed deposit promotion for the Mid-Autumn Festival but customers have to put the cash with the finance company for 15 months.

Balances of $10,000 to less than $50,000 earn 2.4 per cent, while those from $50,000 to less than $200,000 reap 2.43 per cent. Balances from $200,000 onwards get 2.45 per cent.

In the meantime, on OCBC’s website, there are fixed deposits with tenors of 12 and 24 months.

The promotional rate for a minimum placement of $5,000 is 2 per cent for a 12-month tenor and 2.3 per cent for 24 months.

DBS does not offer promotional rates but it raised its general fixed deposit rates – known as board rates – in June and refreshes them regularly.

Fixed deposit rates for balances between $1,000 and $19,999 are 0.15 per cent for a three-month tenor and 0.85 per cent for an eight-month tenor as at Aug 31.

Ms Huong Tran, head of consumer deposits and transactional payments at DBS, said the bank stopped taking fixed deposits with tenors beyond eight months because of the uncertainty of longer-end tenors.

In contrast, a shorter tenor allows the bank to adjust its rates more easily in line with changes in the interest rate environment.

DBS is the only bank in Singapore to increase its board rates, unlike other lenders, which have been dishing out promotional rates.