In Finland, Aktia offers more than 3% on a one-year deposit — YLE News
In Finland, Aktia bank offers slightly more than 3% per year on a 12-month fixed-term deposit. As YLE News reports, demand for such deposits at Aktia increased during the summer amid rising interest rates.
The bank noted that the returns on fixed-term deposits are affected by short-term market rates, including Euribor. Aktia’s Head of Savings and Investments, Thomas Lindholm, linked the rise in short-term market rates to changing inflation expectations, which, he said, were affected by the situation around Iran, the Strait of Hormuz, and oil prices.
Rates depend on the term
According to Aktia, slightly lower rates are offered for shorter deposit terms. At the same time, the deposit amount does not affect the interest rate offered. Aktia named 12 months as the most popular term for this type of deposit.
At S-Pankki, fixed-term deposit rates range from 2% to 3%, depending on the term. Sari Köykkä, Head of Consumer Customer Business, said that the popularity of these products has increased, and that customers are interested in fixed-term deposits alongside other ways of investing.
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S-Pankki also noted that the deposit amount does not affect the rate. According to Köykkä, a longer placement term does not always mean a higher interest rate: the result depends on expectations regarding the further movement of rates.
Conditions for depositors
A fixed-term deposit involves placing a specified amount for an agreed term at a pre-set rate. Once this term ends, the depositor receives the principal amount back. Income from such deposits in Finland is subject to a 30% withholding tax.
Köykkä advised placing only funds that will not be needed before the end of the term in a fixed-term deposit. According to her, those for whom the ability to withdraw money quickly is important can choose a savings account or a short bond fund. Fixed-term deposits in Finland are covered by the deposit guarantee system.
