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Joint News Release by:
Central Provident Fund Board
Housing & Development Board
13 August 2008 --
Interest Rate For Ordinary Account (OA)
The Board will continue to pay 2.50% interest per annum for members' CPF savings in their OA from 1 October 2008 to 31 December 2008. The computed CPF interest rate derived from the major local banks' interest rates for the three-month period, 1 May 2008 to 31 July 2008, works out to be 0.74 % per annum. However, the higher rate of 2.50% will be paid as the CPF Act provides for a minimum CPF interest rate of 2.50% per annum.
HDB's Mortgage Rate
The concessionary interest rate for HDB mortgage loan, which is pegged at 0.1 percentage point above the CPF interest rate for the Ordinary Account, will remain unchanged at 2.60% per annum from 1 October 2008 to 31 December 2008.
The detailed computations of the CPF Ordinary Account interest rate and the HDB mortgage loan interest rate are given in the Annex.
Interest Rate For Special, Medisave & Retirement Accounts (SMRA)
The prevailing (July to September 2008) CPF interest rate for SMRA is 4%. This was computed based on the 12-month average yield of the 10-year Singapore Government Security (10YSGS) plus 1%. The SMRA interest rate for October to December 2008 will be announced in September 2008 after the average yield of the 10YSGS is computed. To help members adjust to this floating rate, the 4% floor for the SMRA rate will be maintained for the first two years.
Extra Interest of 1%
In addition, an extra 1% interest will be paid on the first $60,000 of a member's combined balances, with up to $20,000 from the Ordinary Account (OA). The extra interest from the OA will go into the member's Special or Retirement Account to enhance his retirement savings.
The CPF interest rate will continue to be reviewed quarterly. Improving returns on CPF savings is one of the key changes introduced to help Singaporeans improve their retirement adequacy.
Members with enquiries may call the CPF Call Centre on 1800-227 1188.
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ANNEX : |
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COMPUTATION OF CPF ORDINARY ACCOUNT (OA) INTEREST RATE AND HDB MORTGAGE RATE FOR OCTOBER 2008 TO DECEMBER 2008 |
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12-MONTH DEPOSIT RATE
(% PA) |
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SAVINGS RATE
(% PA) |
AVERAGE
80FD:20SD
(% PA) |
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MONTH / YEAR |
DBS (1) |
OCBC (2) |
UOB (3) |
DBS (4) |
OCBC (5) |
UOB (6) |
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31 May 08 |
0.8250 |
0.8250 |
0.8250 |
0.3500 |
0.5000 |
0.2750 |
0.7350 |
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30 Jun 08 |
0.8250 |
0.8250 |
0.8250 |
0.3500 |
0.5000 |
0.2750 |
0.7350 |
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31 Jul 08 |
0.8250 |
0.8250 |
0.8250 |
0.3500 |
0.5000 |
0.2750 |
0.7350 |
| (A) |
NORMAL CPF OA INTEREST RATE |
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Average for 3 months (MAY 2008 TO JUL 2008)
(Using the 80 FD : 20 SD formula)
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0.74% |
(computed interest rate) |
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CPF OA Interest Rate for OCT 2008 TO DEC 2008 |
2.50% |
(legislated minimum rate) |
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| (B) |
HDB MORTGAGE RATE |
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CPF OA Interest Rate for OCT 2008 TO DEC 2008 |
2.50% |
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Plus: Fee to cover Cost of Loan Administration |
0.10% |
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------- |
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HDB Mortgage Rate for OCT 2008 TO DEC 2008 |
2.60% |
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------- |
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NOTES:
(1) Balances between $20,000 to < $50,000
(2) Balances > $20,000 to $50,000
(3) Balances < $50,000
(4) Balances > $3,000 to $50,000 (AUTO-SAVE Account)
(5) Balances > $10,000 to $50,000 (EASI-SAVE Account)
(6) Balances > $3,000 to $50,000 (UNIPLUS Account) |
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| The CPF OA interest rate at 2.5% per annum remains higher than the 12-month fixed deposit and savings rates of major local banks for the three-month period of 1 May 2008 to 31 Jul 2008. | |
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