BNZ cut short-term home loan rates, following other major banks

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Photo: RNZ / Marika Khabazi

BNZ is the latest of the major banks to cut short-term fixed mortgage rates.

It comes as wholesale interest rates fell following the Reserve Bank’s Official Cash Rate decision last week.

BNZ trimmed rates by between 5 and 10 basis points. Its new six-month rate was 7.29 percent, the one-year rate was 7.24 percent, the 18-month rate dropped to 6.89 and the two year rate was set at 6.79 percent. Its one-year term deposit rate was 6 percent.

On Monday, ASB and ANZ reduced home lending rates following cuts by Westpac and BNZ in February.

ASB said its one-year lending rate had dropped 10 basis points from 7.39 percent to 7.29 percent, and its two-year lending rate had also decreased from 6.89 percent to 6.85 percent. The bank had also increased its 6-month term deposit rate by five basis points to 6.05 percent.

The changes followed ASB’s 18-month mortgage adjustment on 27 February which dropped 26 basis points to 6.89 percent.

“The reduction to some of our key mortgage terms in part reflects how swap rates have responded to the Reserve Bank’s decision to hold the Official Cash Rate (OCR) at 5.5 percent,” ASB executive general manager of personal banking Adam Boyd said.

“We know that the rising cost of living is affecting our customers, and alleviating a bit of pressure will be welcome news for homeowners in the current environment.”

Meanwhile ANZ reduced its one-year fixed rate to 7.24 percent while its two-year rate was 6.79 percent.

Earlier, Westpac dropped home loan rates on 9 February, cutting its special fixed one-year lending rate to 7.29 percent and the 18-month rate to 6.95 percent.

“While we are reducing our rates, we acknowledge that customers may be re-fixing their loans from the historically low rates we have seen over recent years and may still be concerned about their increasing costs,” Westpac NZ general manager of product, sustainability and marketing Sarah Hearn said.

“Our data shows the vast majority of our customers are coping well with higher living costs, but we encourage them to get in touch if they have any concerns.”

Westpac NZ also decreased term deposit rates by between 10 and 30 basis points on all terms between 12 months and five years.