NZ banks cut mortgage rates
(27 July 2015 – New Zealand) Bank of New Zealand (BNZ), ANZ Bank, Kiwibank and ASB Bank all slashed their floating mortgage rates following the Reserve Bank of New Zealand (RBNZ)’s decision to cut the official cash rate (OCR) on 23 July.
The move by the central bank was widely expected, to the point that The Co-operative Bank moved even before the RBNZ decision – slashing its floating rate by 25 basis points and its three, four and five year fixed-terms by 10 to 15 basis points.
Chief executive Bruce McLachlan said the member-owned bank had decided not to wait for the Reserve Bank's signal.
"When we sat and challenged ourselves, we said some of these rates should be coming down now."
Kiwibank matched the RBNZ’s full reduction, reducing its floating rates from 6.40 percent to 6.15 percent.
The country's biggest bank, ANZ, also passed on the savings with a new rate of 6.24 percent.
ASB waited until 24 July to reduce its variable home loan and Orbit home loan rates by 25 basis points from 6.50 percent to 6.25 percent.
The 25 basis point cut is equivalent to savings of over NZ$1000 (A$902) a year for households with a NZ$400,000 mortgage.
Current predictions are that the central bank will make two further cuts over the course of the year, bringing the OCR back to the historic low of 2.5 percent, meaning floating mortgage rates could fall to around 5.75 percent.
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