A change in how ANZ sets minimum repayments puts home loan borrowers with redraw balances in the firing line
Suncorp Bank borrowers who have paid ahead on their home loans could be hit with minimum repayment increases of hundreds of dollars a month when they move to ANZ next year.
Suncorp Bank has written to customers warning that those with advance payments and funds in their cashback or redraw facility are likely to see their minimum repayment rise at ANZ.
The bank told MPA the increase does not involve extra borrowing or a higher interest rate. It reflects the different way ANZ calculates minimum repayments.
“We’re providing all lending customers with early notice of key changes that may take effect when they move to ANZ next year,” Suncorp Bank chief executive Malcolm Stedman said in a statement provided to MPA.
“For most customers there will be no change to their repayments. Those customers ahead on their repayments may see an increase in their minimum repayments, if they choose to take no action.
“By notifying customers early, we’re giving them time to understand their position, consider their options and take action to keep their repayments the same if they choose to.”
Why Suncorp Bank repayments could rise at ANZ
A redraw facility lets borrowers pay more than the required amount and withdraw those extra funds later. Suncorp Bank has allowed customers with redraw and cashback facilities to lower their minimum monthly repayments. ANZ has no equivalent policy. Customers who do nothing will see their minimum rise.
At ANZ, advance repayments still reduce the loan balance, but the minimum repayment is not recalculated. Suncorp Bank pointed out to MPA this means loans are likely to be paid off sooner, with less interest paid overall.
Sally Tindall, director of data insights at Canstar, told ABC that thousands of Suncorp Bank customers were likely to get an “unwelcome shock”. She said the most common practice among banks was to exclude or discount extra repayments when setting the minimum.
The gap can be substantial. Tindall used the example of a borrower who owes $600,000 with 25 years remaining and has $100,000 in extra payments sitting in the loan. A bank that ignores those extra payments sets the minimum on the full $600,000: at the average owner-occupier variable rate of 6.49 per cent, that is $4,047 a month. A bank that counts the extra payments calculates the minimum on $500,000, bringing it down to $3,373 – a difference of roughly $674 a month.
Of course, the size of any change depends on each customer’s loan balance, remaining loan term and advance payments. Borrowers who have built up large advance repayments are most likely to see the biggest increases.
What borrowers and brokers can do before the move
Customers have three options, Suncorp Bank explained to MPA:
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take no action, if the higher repayment suits them
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clear all or part of their redraw balance
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fund the difference in repayments from their redraw
The bank is giving customers a repayment calculator to estimate their minimum repayment after the move. It will also call affected customers directly. Suncorp Bank said the letter is the first of several on lending changes.
“We’re providing access to a repayment calculator to estimate minimum loan repayments payable after the move and the opportunity to discuss their circumstances with us, to help give our customers confidence to make the right decision for their circumstances,” Stedman said.
“As we prepare to move Suncorp Bank customers to ANZ, we’re committed to keeping customers informed well ahead of key changes that may affect them.”
Brokers with Suncorp Bank clients are already managing the end of the brand as a lending option. Suncorp Bank closed off new mortgage lending through broker and proprietary channels from 7 October 2026.
How the Suncorp Bank acquisition unfolded
The repayment shake-up is the latest twist in a deal four years in the making. ANZ agreed to buy Suncorp Bank in July 2022. In August 2023, the Australian Competition and Consumer Commission (ACCC) rejected the $4.9 billion proposal, citing concerns about competition in home lending nationally and in small business and agribusiness banking in Queensland.
That timeline has since been fast-tracked. ANZ chief executive Nuno Matos accelerated the migration as part of a broader 2030 strategy to simplify the group and cut operating costs. In September 2026, the bank confirmed Suncorp Bank’s plan to retire its brand in 2027.
For borrowers sitting on large redraw balances, the countdown to June 2027 has now started.
