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Following ANZ’s second out-of-cycle rate review, the bank announced it would make no change to its interest rates for variable rate mortgages.
The bank said that while the trend for funding costs remains upward, with average term wholesale debt costs continuing to rise, short-term wholesale costs had improved over the past month.
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The move reflects the Reserve Bank’s decision earlier this week to keep the cash rate on hold at 4.25 per cent.
At last month’s inaugural out-of-cycle review, ANZ chose to increase interest rates for variable rate mortgages and small business lending by 0.06 per cent – despite the Reserve Bank’s holding the cash rate steady.
ANZ’s standard variable mortgage rate remains at 7.36 per cent pa (7.46% pa comparison rate).
Whilst there was no change to ANZ's variable rate mortgages the lender did take the opporunity to up their fixed rates. The bank has increased a number of its fixed rate products inlcuding its residential three year fixed package by 20 bps to 6.34 per cent
ANZ’s out-of-cycle reviews reflect a distancing from the Reserve Bank by the majors.
“Our new monthly interest rate review process recognises that the Reserve Bank’s cash rate alone is not an accurate reflection of bank funding costs, particularly since the global financial crisis which has left all banks with the task of raising funds in volatile global markets and through stronger competition for deposits,” ANZ CEO Australia Philip Chronican said.
Last month the other major lenders where quick to follow ANZ's lead and hike up interest rates - all eyes will now be on the other banks and whether they also hold steady on rates.
