Big Banks jump on rate change
(3 December 2008 – Australia) The Big Four banks in Australia jumped on the RBA’s decision to cut interest rates, releasing their own rate reductions in quick succession, but with mixed enthusiasm.
The RBA made the decision to cut the target cash rate by a full percentage point to 4.25 percent, down from 7.25 percent in March this year.
CBA was the first to respond to the move by the RBA, and pass on the full rate cut to home loan and business customers.
Effective 12 December, CBA cut its variable rate on home loans and business loans by 1.0 percent.
NAB made the same move, also announcing a full percentage point rate cut.
Effective the same date, NAB announced that it would reduce its standard variable mortgage interest rate and variable business rates by one percent per annum for new and existing customers.
NAB has passed on the majority of the 3.0 percent cut in the cash rate since September, with its standard variable mortgage rates having fallen 2.87 percent.
ANZ announced that it would drop its variable home loan rate by just 0.83 percent, however said that once wholesale funding costs are reduced, further reductions would be passed on to customers.
At ANZ, interest rates for credit cards, deposit rates and rates for business lending including agri-business don’t yet get the rate reduction and are still under review.
Westpac announced the lowest rate cut of the Big Four banks, at just 0.8 percent, based on similar reasoning of high funding costs as detailed by ANZ.
CBA was the first to respond to the move by the RBA, and pass on the full rate cut to home loan and business customers.
Effective 12 December, CBA cut its variable rate on home loans and business loans by 1.0 percent.
NAB made the same move, also announcing a full percentage point rate cut.
Effective the same date, NAB announced that it would reduce its standard variable mortgage interest rate and variable business rates by one percent per annum for new and existing customers.
NAB has passed on the majority of the 3.0 percent cut in the cash rate since September, with its standard variable mortgage rates having fallen 2.87 percent.
ANZ announced that it would drop its variable home loan rate by just 0.83 percent, however said that once wholesale funding costs are reduced, further reductions would be passed on to customers.
At ANZ, interest rates for credit cards, deposit rates and rates for business lending including agri-business don’t yet get the rate reduction and are still under review.
Westpac announced the lowest rate cut of the Big Four banks, at just 0.8 percent, based on similar reasoning of high funding costs as detailed by ANZ.
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