(16 July 2012 – Australia) ANZ opted to keep its home loan rates on hold on Friday, leaving its standard variable interest home loan rate at 6.8 percent and its small business loans steady.The banks monthly interest rate review meeting mirrors the Reserve Bank of Australia (RBA)’s decision not to cut the cash rate in July.
ANZ chief executive Australia Philip Chronican said the decision to keep lending rates on hold was made despite the higher funding costs facing the bank.
He said as ANZ needed to remain competitive, it chose to keep rates on hold.
‘We know that many Australians are feeling uncertain about the global economy and with household budgets under increased pressure this was another factor in our decision this month,’ he said in a statement.
Chronican said while offshore funding markets used by the banks to source money to lend to customers had begun to stabilise, the situation still remained volatile.
Competition between Australian banks to attract savers also remained strong, particularly with term deposits.
He said while customers benefited from the competition, which has lifted interest rates on savings accounts, it was putting pressure on ANZ’s margins.