Disappointment at NAB rate “trim”
(3 November 2011 – Australia) The fury of Treasurer Wayne Swan was directed at National Australia Bank (NAB), after the bank trimmed its variable mortgage rate by less than the Reserve Bank of Australia (RBA) and other banks.
NAB released a statement on Wednesday saying it would trim its standard variable lending rate by 20 basis points to 7.47 percent effective from Monday, 7 November.
The move fell short of its rivals' offerings. ANZ Bank this morning joined Westpac and Commonwealth Bank in passing along in full yesterday's RBA interest rate cut to customers.
Treasurer Wayne Swan slammed NAB’s decision, saying it was driven by greed rather than higher funding costs.
‘‘It’s a kick in the guts to working families. It’s a greedy decision from the NAB and it is not justified in my view by fundamentals,’’ Mr Swan told journalists in Canberra.
‘‘The NAB abolished all exit fees on their mortgage loans in response to initiatives from this government, so NAB customers have the choice to walk down the road and get a better deal.’’
Although NAB still has the lowest mortgage rates among the major banks, Swan said many other institutions, such as mutuals, were offering cheaper rates.
NAB explained the smaller reduction as a reflection of its earlier more aggressive lending measures and claimed its new rate remained the lowest among the top banks.
'Our commitment is to be competitive and for more than two years, NAB has offered the lowest standard variable home loan rate of any of the major banks,' said NAB group executive Lisa Gray.
'NAB has led the industry and abolished the most disliked fees, including overdrawn fees, account keeping fees and mortgage early exit fees for new and existing customers,' she said. 'NAB customers will today still benefit from having the lowest standard variable rate of any of the four major banks.'
NAB also said it would trim a 'range of deposit interest rates by between 5 basis points and 25 basis points'.
Westpac CEO Gail Kelly was also critical of NAB's move.
‘‘From how I see it there’s no reason not to pass on the full rate reduction,' she said on Wednesday afternoon. 'I think it’s good for the economy, it’s good for customers.'
Westpac-owned Bank of Melbourne also cut its standard variable rate by 25 basis points to 7.55 percent this morning, effective from November 14.
"We are pleased to be able to reward our customers by offering them a competitive variable rate on their home loans,' said Bank of Melbourne Chief Executive Scott Tanner.
ANZ's standard variable rate for new customers will be cut 25 basis points to 7.55 per cent, effective from November 14, ANZ said.
"We're acutely aware that many of our customers are doing it tough and despite higher funding costs we're pleased to be able to pass on the reduction in the cash rate in full," said ANZ CEO Australia Philip Chronican.
The move fell short of its rivals' offerings. ANZ Bank this morning joined Westpac and Commonwealth Bank in passing along in full yesterday's RBA interest rate cut to customers.
Treasurer Wayne Swan slammed NAB’s decision, saying it was driven by greed rather than higher funding costs.
‘‘It’s a kick in the guts to working families. It’s a greedy decision from the NAB and it is not justified in my view by fundamentals,’’ Mr Swan told journalists in Canberra.
‘‘The NAB abolished all exit fees on their mortgage loans in response to initiatives from this government, so NAB customers have the choice to walk down the road and get a better deal.’’
Although NAB still has the lowest mortgage rates among the major banks, Swan said many other institutions, such as mutuals, were offering cheaper rates.
NAB explained the smaller reduction as a reflection of its earlier more aggressive lending measures and claimed its new rate remained the lowest among the top banks.
'Our commitment is to be competitive and for more than two years, NAB has offered the lowest standard variable home loan rate of any of the major banks,' said NAB group executive Lisa Gray.
'NAB has led the industry and abolished the most disliked fees, including overdrawn fees, account keeping fees and mortgage early exit fees for new and existing customers,' she said. 'NAB customers will today still benefit from having the lowest standard variable rate of any of the four major banks.'
NAB also said it would trim a 'range of deposit interest rates by between 5 basis points and 25 basis points'.
Westpac CEO Gail Kelly was also critical of NAB's move.
‘‘From how I see it there’s no reason not to pass on the full rate reduction,' she said on Wednesday afternoon. 'I think it’s good for the economy, it’s good for customers.'
Westpac-owned Bank of Melbourne also cut its standard variable rate by 25 basis points to 7.55 percent this morning, effective from November 14.
"We are pleased to be able to reward our customers by offering them a competitive variable rate on their home loans,' said Bank of Melbourne Chief Executive Scott Tanner.
ANZ's standard variable rate for new customers will be cut 25 basis points to 7.55 per cent, effective from November 14, ANZ said.
"We're acutely aware that many of our customers are doing it tough and despite higher funding costs we're pleased to be able to pass on the reduction in the cash rate in full," said ANZ CEO Australia Philip Chronican.
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