Major NZ banks update mortgage rates

One bank lowered rates to “provide certainty” to customers in a “rising rate environment”

Major NZ banks update mortgage rates

ANZ, BNZ, and Westpac have updated their mortgage rates following ASB’s announcement of its new rates, ending the downward trend in interest rates.

ASB increased its interest mortgage rates ahead of the Reserve Bank of New Zealand’s (RBNZ) Monetary Policy Review and official cash rate (OCR) announcement, with its one-year fixed mortgage rate jumping from 2.19% to 2.55%. Its two-year fixed rate also increased from 2.59% to 2.95%. Meanwhile, its six-month, 18-month, three-year, four-year, and five-year rates increased by 0.30%.

Now, ANZ has announced that it has increased its one-year rate by 31 basis points to 2.5%, two-year rate by 31 basis points to 2.9%, and its three-year rate by 25 basis points to 3.24%, NZ Herald reported.

A spokesperson for ANZ said in a statement that the bank raised its mortgage rates “in response to a number of market factors,” particularly progressive increases in wholesale interest rates.

BNZ has also increased its one-year rate by 36 basis points to 2.55%, its two-year rate by 40 basis points to 2.95%, and its three-year rate by 26 basis points to 3.25%.

Westpac followed in the footsteps of the three banks – increasing its one-year rate by 36 basis points to 2.55%, its two-year rate by 30 basis points to 2.89%, and its three-year rate by 30 basis points to 3.29%.

Read more: Industry releases forecasts following OCR announcement

By contrast, Kiwibank dropped its two-year home loan rate to 2.49% to “provide certainty” to its customers in the rising rate environment. Its variable rate also changed from 3.4% to 3.75%, still below all major competitors.

“We challenged the market by reducing the pricing gap between fixed and floating rates, giving our customers greater flexibility, choice, and savings. In a time of uncertainty, we wanted to provide Kiwis with an opportunity to pay back their loans faster, save, or buy local and support our economy,” said Kiwibank chief Executive Steve Jurkovich.

“I’m proud that as a challenger, we are providing Kiwi with a real alternative to the Australian-owned banks as well as supporting the growth and progress of all New Zealanders.

“We will continue to pursue our goal to lead the New Zealand financial services industry by being a better banking alternative that’s committed to being fair and easy for Kiwi, the businesses they own, and for future generations.”

One bank lowered rates to “provide certainty” to customers in a “rising rate environment”

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