Hikes were described as the 'biggest move in years'
Toronto-Dominion Bank has lifted its posted rate for five-year fixed mortgages by 45 basis points to 5.59% as government bond yields touched their highest levels since 2011 last week.
Canada’s second-largest lender also increased its two-year, three-year, six-year, and seven-year mortgage rates, bank spokeswoman Julie Bellissimo said in an e-mailed statement.
“Adjusting our rates is not a decision we take lightly,” Bellissimo stated. “We look at a number of factors when determining rates including the competitive landscape, the cost of lending and managing risk.”
Despite the hike, rates “remain competitive and at historically low levels,” Bellissimo assured.
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“It’s a big move, the biggest move in years,” RateSpy.com founder Rob McLister told Bloomberg. “There’s a lot of reasons why that could be -- maybe they’re taking a position on rates going forward, which is not that typical; maybe they’re trying to get people to lock in and generate better spreads.”
The change came as the yield on five-year federal government bonds rose to 2.18%, the highest in almost seven years.
Toronto-Dominion’s posted rate now stands higher than those of Royal Bank of Canada, Bank of Nova Scotia, and Bank of Montreal, which each advertise posted rates of 5.14%. Canadian Imperial Bank of Commerce has the lowest posted rate at 4.99%.
