Mortgage holders will begin feeling the effect of the Reserve Bank’s rate hike, with the big four banks passing the rise on to customers.
ANZ, Commonwealth Bank, Westpac and NAB matched Tuesday’s move by the RBA, lifting variable rates by 50 basis points from next week.
The banks have also announced increases to interest on certain savings accounts.
The move comes after calls from Treasurer Jim Chalmers for banks to pass on increases in rates for deposits as well as home loans.
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Commonwealth Bank retail banking chief Angus Sullivan said the lender, the first to announce the rate rise, would offer a limited four-year fixed rate of 4.99 per cent for owner-occupiers.
“This special is a reduction of 1.60 per cent per annum from our current four-year fixed-package rate and has been rolled out especially to support customers looking for certainty in a changing rate environment,” he said.
Westpac matched the offer of a special four-year fixed rate of 4.99 per cent and announced it would lift interest rates on two of its most popular accounts to boost the returns on savings for many customers.
Some customers would feel financial pressure, Westpac consumer and business banking chief executive Chris de Bruin acknowledged.
“We’re here to support these customers and encourage them to give us a call,” he said.
“New and existing customers could fix their loan for four years which may provide more certainty over their repayments, or split their loan between fixed and variable rates.”
ANZ increased the rate on its ANZ Plus Save account from Monday and said it would review other longstanding savings accounts.
The persistent low-rate environment of recent years has been challenging for savings customers, ANZ retail group executive Maile Carnegie said.
“So today we have tried to provide some relief for them with a range of deposit rate increases,” she said.
NAB was the last to announce it would pass on the rate hike to its customers, with personal banking group executive Rachel Slade urging customers to contact them if they were struggling.
“Please get in touch – the earlier the better,” she said.
“The first step is a conversation so we can help you get back on track.”
ABS data on lender indicators showed Australian mortgage owners are switching banks in record numbers to get a better deal.