 Five major banks cut home loan rates
All five major banks - St George, Commonwealth, ANZ, NAB and Westpac - have moved to cut home loan rates following Tuesday's official interest rate cut by the Reserve Bank of Australia. St George is the latest bank, cutting their standard variable rates 62 basis points. The rate is now 7.74 per cent, effective November 14.
Immediately after the RBA cut interest rates by 75 basis points, the Commonwealth Bank of Australia cut variable home loan rates by 58 basis points. Two days later, Westpac, ANZ and NAB all moved to cut their standard variable mortgage rates by 0.65 per cent, 0.58 per cent and 0.62 per cent respectively.
But there is disappointment from some corners than not one of the big banks passed on the RBA rate cut in full. Again, banks blame funding costs for this. Funding costs have risen considerably over the past year, however recent cuts in the costs have prompted this interest rate cut.
"Due to the continued impacts of the global financial crisis, financial institutions are facing significantly higher costs in both the short and long term wholesale funding markets," St George head of retail banking Les Matheson said.
The latest round of cuts mean noticeable savings of around $120 per month on a $250,000 mortgage.
St George has also made a 0.25% cut to its fixed home loan rate.
AMP Banking have decided they will pass on the 75 basis point reduction in full to borrowers.
The cash rate now sits at 5.25% and many are predicting the RBA will cut rates further next month.
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