Trending News 5 June

Which lenders have passed on the RBA rate in FULL?

The Reserve Bank of Australia cut the official cash interest rate in Australia by 0.25 percentage points on Tuesday 4 June to just 1.25 per cent.

Australia’s biggest lender, the Commonwealth Bank and National Australia Bank have announced they will pass on the Reserve Bank’s cut in full to their retail home loan customers.

The Commonwealth Bank will reduce variable loan rates by 0.25 percentage points, effective from 25 June 2019. Commonwealth’s new lowest headline home loan rate is now 3.54 per cent. CBA’s standard variable home loan rate is now 5.12 per cent per annum.

NAB will reduce variable loan rates by 0.25 percentage points, effective from 14 June 2019. NAB’s new lowest headline home loan rate is now also 3.54 per cent. NAB’s standard variable home loan rate is now 5.11 per cent per annum.

Athena Mortgage, RACQ Bank and Bananacoast Credit Union have also announced they are passing on the RBA rate cut in full.

Which banks and lenders have NOT passed on the RBA rate cut to borrowers?

The Reserve Bank of Australia cut the official cash interest rate in Australia by 0.25 percentage points on Tuesday 4 June to just 1.25 per cent.

ANZ Bank quickly announced it would cut rates for its home loan customers by just 0.18 percentage points, effective from the 14 June 2019. ANZ’s new lowest variable headline home loan rate is now 3.63 per cent.

Westpac announced it would cut rates for its retail home loan customers by 0.20 per centage points, effective from the 18 June. Westpac’s new lowest variable headline home loan rate is now 3.78 per cent.

ANZ and Westpac’s standard variable home loan rate (P&I) for owner-occupier borrowers is now 5.18 per cent per annum.

ING Bank have announced a 0.17 percentage point rate cut for variable home loan borrowers.

Have ANZ and Westpac “let down their customers?”

ANZ Bank very quickly announced it would not be passing on the full RBA rate cut to its customers, soon after the RBA itself cut rates by 0.25 percentage points. ANZ announced rate cuts of 0.18 percentage points and Westpac announced rate cuts of 0.20 percentage points.

“We recognise some home loan customers will be disappointed,” said ANZ executive Mark Hand, “we have needed to balance the increased cost in managing our business with our desire to provide customers with competitive lending and deposit rates.”

Treasurer Josh Frydenberg said ANZ’s decision was “deeply disappointing.”

“I think the ANZ has let down its customers. This is deeply disappointing from the ANZ.”

Westpac executive David Lindberg said the bank had taken into account the interests of all stakeholders in making their rate cut decision.

Property price falls may be slowing

Residential property prices in Australian capital cities fell 0.4 per cent in May 2019 according to CoreLogic. Property prices have been falling in Australia since September 2017. Home prices are down 8.4 per cent over the last 12 months and are now more than 10 per cent below their peak in September 2017.

Sydney residential property prices fell 0.5 per cent in May and are now down 14.9 per cent from their 2017 peak. Melbourne prices fell 0.3 per cent in May and are now down 11.1 per cent from their 2017 highs.

Prices also fell in Perth (1 per cent), Darwin (1.6 per cent), Brisbane (0.5 per cent), Canberra (0.2 per cent) and Hobart (0.4 per cent). Adelaide prices were stable, rising just 0.2 per cent.