ANZ follows NAB in business rate hike
(8 February 2016 – Australia) ANZ has followed National Australia Bank in increasing borrowing rates on business loans, citing rising funding costs and onerous regulatory changes eating into margins.
The bank advised brokers on Friday that that overdraft and term loans for businesses linked to a range of indices would increase by 21 basis points, effective February 12.
Loan rates would rise to between 6.87 percent and 9.37 percent.
ANZ’s so-called equity manager rate — a line of credit that is secured by property — would also rise by 27 basis points to 5.98 per cent.
The move follows a decision by rival National Australia Bank, the nation’s biggest lender to businesses, to hike rates on 30-day, 60-day and 90-day business loans by 29, 13 and 8 basis points, respectively.
ANZ said while commercial lending rates remained “close to historic lows”, the environment was changing as funding costs rose and regulators tightened capital and liquidity requirements.
“With the increase in US interest rates announced in November, these higher funding costs are now locked in for the foreseeable future, and while we have worked hard to absorb as much as possible, we now have no choice but to pass on some of the higher cost,” ANZ said.
Of the Big Four, ANZ retains the smallest market share with 16.3 percent, according to the latest figures from East & Partners Deposit Funding Debit Index.
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