Following the Reserve Bank of Australia’s decision to raise the cash rate by 0.25 percentage points, Westpac and National Australia Bank (NAB) have announced they will pass on the increase to their mortgage customers. This move mirrors Commonwealth Bank’s (CBA) earlier announcement, with ANZ and smaller banks anticipated to follow suit in the coming days. The increased home loan rates from NAB will be effective from February 13, while Westpac’s new rates will commence on February 17.
Similar to CBA, both NAB and Westpac have encouraged customers facing difficulties with their repayments to contact the bank for assistance. Westpac chief executive of consumer banking, Carolyn McCann, noted that most of their customers are ahead on their repayments, placing them in a better position to manage the rate change. Westpac is one of Australia’s largest banks, providing a broad range of financial services. NAB also provides a range of financial services to individuals and businesses.
CBA has also confirmed it will increase variable interest rates on business loans by 25 basis points. However, none of the three major banks, CBA, Westpac or NAB, have yet made any announcements regarding changes to their savings rates. This silence raises concerns about whether savers will fully benefit from the rate hike.
Sally Tindall, data insights director at Canstar, suggested that banks often selectively apply rate increases to specific savings accounts, potentially leaving some savers without the full benefit of the rise. She said that this could be a worrying sign for savers as banks may not pass on the hike in full to each and every one of its savings rates.
