Big banks react to RBA’s December rate hike

The Reserve Bank of Australia (RBA) made its eight consecutive rate hike this month, pushing the cash rate to 3.10%. 

Here are the responses from the major banks: 

Westpac

Westpac was the first to announce changes to interest rates following the RBA hike this month.

It is passing the rate hike in full to its home loan borrowers, with variable rates increasing 25bps effective 20 December. This change will apply to new and existing borrowers.

Westpac is also increasing its deposit rates, with the Westpac Life total variable rate increasing to 3.75% effective 16 December.

Meanwhile, eligible customers under Westpac’s Spend & Save offer can earn a total variable rate of 4.35%, reflecting a 35bps increase, effective 16 December.

Westpac consumer and business banking chief executive Chris de Bruin said these changes took into consideration the fact that the bank’s customers are paying extra attention to their budgets in the lead-up Christmas and New Year.

“We’re continuing to increase savings interest rates to support customers saving for the future,” he said.

“While the majority of our customers are managing well through this cycle with a strong jobs market and savings built up during the pandemic, we understand some customers may find it more difficult.”

How to contact Westpac: Customers can call Westpac Customer Care on 132 032.

NAB

NAB is the second major lender to announce changes to its rates.

Starting 16 December, its standard variable home loan rate will increase by 25bps.

NAB has yet to announce any changes to their savings and term deposit rates.

Since May, NAB has made more than 45 increases across its savings products. Most recently, it hiked its NAB iSaver intro rate and its term deposit rates by 50bps.

NAB group executive for personal banking Rachel Slade said the bank will continue to provide support for those who find current conditions challenging.

“At NAB, we have a dedicated team who listen to each customer’s individual situation and are able to offer tailored solutions – whether that be a reduced payment arrangement, payment break or restructuring their loan,” she said.

How to contact NAB: Customers can speak to a home loan specialist by calling 13 78 79.

ANZ

ANZ will be increasing its variable rates by 25bps starting 16 December.

This change will increase monthly repayments by $65 on a variable home loan of $450,000 for an owner occupier paying principal and interest.

However, ANZ has yet to roll out any changes to their savings products, keeping the deposit rates under review.

ANZ Group Executive Australia Retail Maile Carnegie said the bank recognises that pressure many households are feeling amid the increasing cost of living and rising rates.

“If customers are facing difficulties, we urge them to reach out to us as early as they can to discuss tailored options to support them and their circumstances,” she said.

How to contact ANZ: Customers can call 13 13 14 or log on to anz.com for assistance.

CommBank

CommBank is passing on the full rate hike to its home loan customers, with variable rates set to increase by 25bps starting 16 December.

Meanwhile, CommBank will be rolling out changes to its savings products:

• NetBank Saver standard variable interest rate will be increased to 1.60% p.a. while the five-month introductory rate will increase to 3.75% p.a.
• GoalSaver with bonus interest rate will be raised to 3.25% p.a.
• Youthsaver with bonus interest rate will be up to $3.50% p.a.

These changes to savings rates will be effective 16 December.

CommBank will also be extending its 18-month Term Deposit special offer of 4% p.a.

CommBank group executive for retail banking Angus Sullivan said the bank is exploring ways to further provide support to its clients who may be feeling the stress of the current environment.

“We have helped customers save in excess of $22m when they shop using our cashback program, CommBank Rewards, in the CommBank app,” hhe said.

“Millions of CBA customers have engaged with our shopping offers, with close to 75% of redemptions over the last quarter being claimed on everyday essential purchases including grocery, fuel, food, pharmacy and pet supplies,” he said.

Furthermore, the bank is extending its free, three-year nbn plan for home seekers for a further six months.

“In June this year, we announced we would – in partnership with More – provide eligible conditionally pre-approved home loan customers with access to a free nbn plan for three years,” Mr Sullivan said.

“We have now extended this offer by a further six months, helping eligible homeowners who maintain their home loan with us to save thousands of dollars.”

How to contact CommBank: Customers can send a message any time in the CommBank app and they will be connected to the Financial Assistance Solutions Team.