(26 October 2009 – Australia) ANZ is the first of the ‘Big Four’ to promise not to increase its variable interest rates above official moves by the Reserve Bank until it becomes clear that Australia has recovered from the global economic downturn.The pledge comes after warnings from Treasure Wayne Swan that independent rate increases by major banks could not be justified in the current economic conditions.
Mike Smith, chief executive officer, ANZ, told the Herald Sun in an interview that the bank would be reluctant to do anything until they really have to.
ANZ is concerned that the country is in a quite fragile state of recovery. The bank is reluctant to move above the Reserve Bank right now because it does not see how this could be in the best economic interests of Australia, Mr Smith added.
At this stage there has been no word from the other major banks ruling out such moves; the ANZ’s pledge will put pressure on them to follow suit.
The promise from ANZ does not apply to fixed rate mortgages, which tend to be repriced on a weekly basis in response to money market movements.