A broking industry body has criticised the major banks’ failure to fully pass on the RBA’s historic cash rate decision.
Peter White of the Finance Brokers Association of Australia (FBAA) has said it was “bitterly disappointing” that the Commonwealth Bank of Australia (CBA), National Australia Bank (NAB) and ANZ failed to pass on in full the Reserve Bank’s 25 basis point cut.
“It was disheartening to find the CBA and NAB not passing on the full reduction which most banks passed on during the last official rate reduction in May,” Mr White remarked.
“Banks must protect shareholders but they must look after their customers,” he said.
Mr White also questioned the CBA’s decision to commence its new rate on 19 August, three weeks after the Reserve Bank’s decision.
“When rates rise the lenders lift their variable rates immediately,” he said, “Again it is the customer who is being treated poorly”.
For customers who have fixed loans, Mr White suggests they think carefully about the prospect of refinancing and a potential move to a variable loan.
“My advice would be to have a mixture of both fixed and variable, but be aware that rates will inevitably climb, perhaps sooner rather than later,” he concluded.
[Related: Big banks react to cash rate call]