Big banks slash rates ahead of RBA decision

By Gerv Tacadena

One bank cuts borrowing costs for owner-occupiers while another trims investor rates

Ahead of the Reserve Bank of Australia's first monetary policy decision scheduled in less than two weeks, ANZ and Westpac has announced several changes to their offered rates.

ANZ has cut both its home-loan and deposit rates. For owner-occupiers paying principal and interest, the variable rate was reduced by up to 20 basis points. The changes apply to ANZ's Simplicity Plus Home Loan offer.

The table below shows the changes to ANZ Bank's variable rates:

ANZ’s Variable Rate Changes

Home Loan

New Rate

Old Rate

ANZ Simplicity Plus Home Loan

LVR: 80% or below

3.12%

3.24%

ANZ Simplicity Plus Home Loan

LVR: Above 80%

3.58%

3.38%

Of the big four, ANZ now offers the second-lowest ongoing variable rate next to NAB’s 3.09%. The lowest variable rates currently being offered by Westpac and CBA are at 3.18% and 3.22%, respectively.

ANZ also slashed the base rate of its Online Saver accounts, from 0.10% to 0.05%. The introductory rate for the first three months has also been reduced from 1.6% to 1.55%.

This is how ANZ's deposit rate compares with those of the other big banks:

Big Four Bank’s Deposit Rates

Bank

Introductory Rate

Ongoing Rate

ANZ

1.55%

(first three months)

0.05%

NAB

1.55%

(first four months)

0.11%

CBA

1.65%

(first five months)

0.10%

Westpac

1.66%

(first five months)

0.10%

For its part, Westpac decided to lower its fixed rates for both principal and interest (P&I) and interest-only (IO) investor loans.

The table below shows the changes to Westpac’s fixed rates for both P&I and IO loans. The comparison rates indicated below are calculated based on a $150,000 loan amount for an overall loan term of 25 years:

Westpac Fixed Rate Investment Loans – P&I (Premier Advantage Package)

Fixed Term

New Rate

Old Rate

Comparison Rate

One year

3.19%

3.69%

4.40%

Two years

3.09%

3.28%

4.31%

Three years

3.09%

3.28%

4.23%

Four years

3.19%

3.69%

4.19%

Five Years

3.19%

3.69%

4.12%

 

Westpac Fixed Rate Investment Loans – IO (Premier Advantage Package)

Fixed Term

New Rate

Old Rate

Comparison Rate

One year

3.39%

3.79%

4.65%

Two years

3.29%

3.49%

4.54%

Three years

3.29%

3.49%

4.46%

Four years

3.39%

3.79%

4.41%

Five Years

3.39%

3.79%

4.35%

Check out Your Mortgage’s Compare Home Loans tool to know more about the cheapest rates in the market.

More Mortgage News