Banking Day

20 bps mortgage cut the norm

08 July 2019 6:18am

Forty-nine lenders announced mortgage interest rate changes lasts week - the week the Reserve Bank cut the cash rate to 1.00 per cent. The average cut for mortgage holders is 20 basis points.

According to RateCity, lenders that cut by 25 bps include ANZ, Athena, Auswide, Loans.com.au, Newcastle Permanent, RACQ, Resimac and UBank.

Westpac and its subsidiary banks cut the variable rate for investors paying interest only by 30 bps, but at one big bank the investor rate cut was half this level.

In line with the market norm is Bendigo Bank, which for a second time will decrease its variable interest rates by 20 bps, at least for new and existing owner occupier home loans. For investor home loans Bendigo will lower rates by 20 bps.

This means of the 50 bps in RBA rate cuts since early June Bendigo has cut by 40 bps for its core owner occupier market and by 35 bps for investor.

Marnie Baker, the bank’s managing director, spoke for many lenders when she said in a media release: “Today’s announcement aims to provide a competitive rate whilst carefully taking into account the diverse interests of all our stakeholders, the performance of our business, our market competitiveness, market conditions and importantly, the strength of our national network which supports the prosperity of communities across the country.”

Some of the smaller rate reductions include Macquarie Credit Union’s 12 bps cut, and Bank Australia’s 16 bps cut. Bank of us, Bank of Queensland, Heritage Bank, ME Bank, People’s Choice Credit Union, Qudos Bank and BOQ's Virgin Money all cut by 15 bps.

Article by: John Kavanagh


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