Holm Bank Raises Fixed-Term Deposit Rates to 3% Regardless of Term

Until 28 September, Holm Bank is offering a fixed annual interest rate of 3% on all fixed-term deposits, regardless of their duration. The last time Estonian banks offered an average fixed-term deposit rate of 3% was in December last year.

Currently, fixed-term deposit rates offered by Estonian banks range between 1.5% and 2.5%, depending on the length of the deposit. Holm Bank’s September offer stands out with its uniform rate, diverging from the usual approach where the rate depends on the deposit term.

“Inflation in Estonia is currently 6.1%, while the average fixed-term deposit rate in July was around 2%. There are no signs that deposit rates will rise significantly in the near future. This means that, in real terms, no deposit option today can fully preserve the purchasing power of savings. At the same time, Estonian households hold nearly €10 billion in current accounts, earning little or no interest at all. A fixed-term deposit cannot completely eliminate the impact of inflation, but it remains one of the safest ways to protect savings. And, of course, inflation will not stay this high forever,” said Holm Bank CEO Kaspar Kalvet.

For example, if someone has €5,000 in spare funds, its purchasing power would fall to roughly €4,700 after one year due to inflation. Placed in a one-year fixed-term deposit at 3%, however, it would earn €150 back in interest.

“The record amount of money sitting idle in current accounts reflects a natural reaction to an environment where inflation outpaces deposit returns and the economic outlook is uncertain,” Kalvet added. “People’s strategies vary greatly – some seek higher returns through investments, while others prioritise stability and security. Fixed-term deposits remain an important part of saving behaviour, offering reassurance and, in Estonia, protection of up to €100,000 through the Guarantee Fund.”

At the end of the second quarter this year, Holm Bank’s deposits exceeded €200 million. By the end of June, the bank’s consolidated assets stood at €239.3 million.

Holm Bank is a privately owned Estonian bank that operates in Estonia and Latvia and owns the brands Holm and Liisi. Its portfolio includes financing for private and business customers, physical and virtual credit cards, hire-purchase, leasing, and fixed-term deposits.