Other banks also announce changes
Following the 0.25% rise in the official cash rate this month, NAB, Westpac and ANZ have announced their variable home loan rates are going up.
AMP Bank has also announced changes to home loan rates for new and existing customers, while Macquarie Bank said it would lift its variable home loan rates by 25 basis points, effective March 22.
Each of the three big four banks is passing on the 0.25% rate hike to variable home loan rates in full, effective March 17 (NAB and ANZ), and March 21 (Westpac). Additionally, banks have announced they are passing through the 0.25% increase on selected savings products and term deposits.
The decisions follow a 10th rise in the official cash rate on March 7, bringing it to 3.60%.
In a statement on Thursday morning, NAB said its standard variable home loan rate would increase by 0.25%, effective from March 17.
NAB group executive personal banking Rachel Slade (pictured above left) said the bank was helping customers who were finding it tougher to get by, including those who may be facing financial challenges for the first time.
“We know most of our customers are in good shape but, for some Australians, financial difficulty might be an entirely new experience as rising costs put increased pressure on their finances,” Slade said.
Slade said the bank’s support was designed to get customers through the tough times. When customers reach out to the NAB Assist team early, over 95% are back on their feet financially within three months, she said.
“As rates increase so does the focus on savings and deposit products, so now is a great time to shop around and find the best rate and product features that work for you,” Slade said.
Westpac said on Thursday afternoon its home loan interest rates would increase by 0.25% for new and existing customers from March 21.
Westpac chief executive consumer and business banking Chris de Bruin (pictured above centre) said the bank understood that after a number of successive rate rises, people were starting to cut back their spending.
“To help customers manage their budgets we offer a range of tools in the Westpac app to track spending and break down expenses,” de Bruin said.
While the majority of customers were in a good position to absorb the impact of rising interest rates, de Bruin said the bank recognised the challenges of cost of living pressures.
“We stand ready to support customers requesting hardship assistance at this time,” de Bruin said.
When reviewing interest rates, Westpac considers a range of factors, including the cash rate, returns and market environment, he said.
ANZ confirmed on Thursday afternoon that variable interest rates across Australian home loans would increase by 0.25%, effective March 17.
ANZ Group Executive Australia Retail, Maile Carnegie (pictured above right) said the bank understood that the latest rate increase, combined with cost of living pressures, might cause some customers to feel greater financial pressure and uncertainty.
“If you’re facing difficulty, reach out to us as soon as you can. Our expert teams are here to tailor our support to your specific circumstances,” Carnegie said.
On a variable home loan of $450,000 (for an owner occupier paying principal and interest), the 0.25% rise to variable home loan interest rates would increase monthly repayments by $66, Carnegie said.
Also on Thursday afternoon, AMP confirmed the interest rates for variable rate home loans will increase by 0.25% from March 10 for new customers, and March 13 for existing customers.
Increases to savings rates
NAB confirmed it is increasing its Reward Saver bonus interest rate by 0.25% to 4.25%, along with the introductory and standard variable rates applying to iSaver (4.25% and 1.60% respectively).
Term deposit rates would increase across a range of terms, by up to 1.10%, NAB said.
Westpac said its eSaver standard variable rate would increase by 0.25% from March 17, bringing the total variable rate to 4.25% for new eSaver customers for the first 5 months. The bank also has a 12-month term deposit offer of up to 4.35%.
ANZ said it would increase the savings rate on its Plus Save account (for balances less than $250,000) by 0.25% to 4.25%, effective March 17. For customers who prefer a fixed rate of return, ANZ said it would offer a new 12-month advance notice term deposit rate of 4.40%, effective March 14.
AMP said the variable deposit bonus rate on its Saver Account would increase by 0.50% effective May 1, 2023. The welcome bonus rate for new AMP SuperEdge Saver customers would increase by 0.80% effective March 20, and the interest rate on AMP Notice products would increase by 0.25% from March 13.
Ratings agency Moody’s has warned that the poor affordability in the Australian mortgage market will increase the rate of delinquencies and defaults for new mortgages.
According to RateCity.com.au analysis, Westpac’s lowest variable rate for owner-occupiers (from March 21) is 5.14% for two years, and 5.54% thereafter. From March 17, NAB’s basic variable rate is 5.49%.
