How safe is our fixed term deposit with Suncorp?

Q.  How safe is our fixed term deposit of $260,000 with Suncorp that we have deposited for 3 years? I have heard a few rumours that Suncorp could be sold and wonder how safe are our funds a) if suncorp is not sold and b) if suncorp is sold. My husband and I are both now retired and wanted to be sure of our investment.

Josie’s answer:   Lots of rumours flying around at the moment that Suncorp will be gobbled up by the Commonwealth Bank or ANZ.  CBA have already pounced on Bank West.

Oh the poor banks they really seem to be really suffering at the moment (with my tongue firmly in my cheek!).   Suncorp are a second tier bank, which means they don’t have the same rating as the big four i.e. Commonwealth, ANZ, NAB and Westpac.

For your information, the big four banks have a AA rating, which is the highest rating you can achieve and only 20 banks in the world have been stamped AA.    A great effort, considering there are thousands of banks around the world.

I would love to tell you that everything is OK, but the reality is, nobody really knows.  I know this does not help you one little bit.   There is no point telling you that your term deposit is safe, because you would interpret that as, ‘Josie has told me that my term deposit is guaranteed, which means  I will have no trouble accessing my money in the future’.

There is just way too much happening in the world for me to give you that assurance.   However, my gut feeling is that there it is highly unlikely that your money will be lost.  If Suncorp is sold, it will be to a strong and robust bank.    If Suncorp is not sold, they will have to rebuild and somehow find a way to get itself out of trouble.     Most likely it will be gobbled up.   These are very interesting times, and the strong will get stronger and like vultures, they will take advantage of the weak.

What I have been telling some people who are losing sleep at night worry about their money, is to think about depositing their money across two or three institutions.  That way, not all your eggs are in the one financial institution basket.

Cheers and wishing you lots of restful nights.

Josie Kay

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