The CEO of the Commonwealth Bank, Ralph Norris, has indicated that the banks will not make a grab for extra margin as official rates begin to rise, The Daily Telegraph reported today.

When asked if borrowers could expect rate hikes higher than RBA increases, Norris said: "I would be surprised if that was the case.

The major banks, which had been in lockstep with each other on interest rates for a number of years, started moving independently about two years ago. CBA's margin over the official rate has grown by about 1% in two years, including hikes outside the official schedule and failing to pass on cuts.

At 5.74%, CBA and NAB have the lower variable home loan rate of the big four banks with ANZ and Westpac on 5.81%. Heritage Building Society is offering 5.45% while Credit Union Australia's standard variable rate is currently set at 5.52%.

Despite these reassuring comments, Lisa Montgomery, consumer advocacy with Resi Mortgage Corporation says borrowers are not guaranteed the banks will stay with the RBA rate movements. 

"There's a possibility that the banks will move outside the RBA because there's still pressures in the capital market in terms of cost of funds. That is obviously disconcerting to borrowers so preparing now is the best thing to do."

For your complete guide to managing your home loan and practical tips on how to beat the rate rise, pick up a copy of Your Mortgage magazine, out on sale now.

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