(16 February – Australia) Westpac has responded to NAB’s attack by cutting a A$395 home loan fee and increasing rate discounts.Westpac has also decided to waive the first-year Premier Advantage Package annual fee for new mortgages of more than A$250,000.
Those borrowing at least that amount but less than A$500,000 will also get an extra five basis points off their home-loan rate – a 0.75 percentage-points discount off the standard variable instead of 0.7 percent, saving about A$100 a year.
For those borrowing more than A$500,000 – now a typical first mortgage in Sydney – the discount will be increased to 0.8 percent, saving A$405 a year.
Westpac’s action followed NAB’s offer to pay mortgage exit fees for Westpac and Commonwealth Bank clients and subsequently the “break up” campaign.
Australian Bankers’ Association chief Steve Munchenberg said: ‘I think that the banks taking shots at each other demonstrates how serious they are about taking customers from each other.’
On that front Westpac believes it is winning, with head of retail banking Jason Yetton saying in an internal note to staff yesterday: ‘We’re not losing business to NAB.
‘In the year to December 2010, Westpac has refinanced more home lending business from NAB than we’ve lost ($545 million from NAB to Westpac versus $425 million from Westpac to NAB).’
The Commonwealth Bank has yet to return fire.