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Westpac increases fixed rates

Staff Reporter 3 minute read

Westpac has confirmed yesterday that it will lift interest repayments on its fixed rate mortgages by as much as 0.25 per cent.

Westpac senior media relations manager Jane Counsel told Mortgage Business that higher funding costs and market rate movement had forced the bank to lift its rates.

“We are moving in line with the yield curve,” Ms Counsel said.

Higher funding costs and new liquidity rules from the Australian Prudential Regulation Authority continues to place pressure on the majors.

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Westpac's chief executive Gail Kelly told The Australian Financial Review yesterday that the new liquidity rules could have serious, unintended consequences on funding availability.

ANZ treasurer Rick Moscati agreed and said that under APRA’s current proposals lending growth may have to slow and “the cost of funding lending would increase significantly.”

Since April last year, Westpac has raised its fixed rates by more than 110 basis points.

A spread of 25 basis points now separates the four majors, with Westpac’s five year fixed rate home loan is priced the highest at 8.14 per cent.

CBA and ANZ follow closely behind at 8.04 per cent, while NAB offers the most competitive five year fixed rate at 7.89 per cent.

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