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‘Significant’ spike in funding costs prompts rate hike

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Reporter 2 minute read

BOQ has announced that it will be increasing interest rates across its variable home loans and lines of credit for owner-occupiers and investors.

The non-major’s variable home loan rate for owner-occupiers (principal and interest repayments) will increase by 0.09 of a percentage point per annum.

Variable home loan rate for owner-occupiers (interest-only repayments) will increase by 0.15 of a percentage point per annum.

Variable home loan rate for investors (principal and interest and interest-only repayments) will increase by 0.15 of a percentage point per annum, and owner-occupier and investor lines of credit will increase by 0.10 of a percentage point per annum.

Anthony Rose, acting group executive, retail banking, said that the decision is largely due to the increased cost of funding.

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“Funding costs have significantly risen since February this year and have primarily been driven by an increase in 30 and 90-day BBSW rates, along with elevated competition for term deposits.

“While the bank has absorbed these costs for some time, the changes announced today will help to offset the ongoing impact of the increased funding costs.

“These decisions are always difficult and BOQ balances the needs of our borrowers and depositors when making changes.”

The interest rate changes are effective beginning Monday, 2 July 2018.

‘Significant’ spike in funding costs prompts rate hike
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James Mitchell

James Mitchell

James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.

He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.

He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.

James holds a BA (Hons) in English Literature and an MA in Journalism.

 

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