Westpac today announced a reduction in interest rates across a range of variable lending products for home owners and small businesses, while increasing a range of term deposit rates for savings customers.
- Variable home loan (owner occupier) rate reduced by 0.14% to 5.29% per annum for customers with principal and interest repayments;
- Variable residential investment property loan rate reduced by 0.14% to 5.56% per annum for customers with principal and interest repayments;
- Variable home loan (owner occupier) rate reduced by 0.10% to 5.33% per annum for customers with interest only repayments;
- Variable residential investment property loan rate reduced by 0.10% to 5.60% per annum for customers with interest only repayments;
- Variable cash rate business loans will be reduced by 0.10%; and
- One year term deposit rate increased by 0.55% to 3.00% per annum, two year term deposit rates increased by 0.45% to 3.10% per annum, and three year term deposit rates increased by 0.55% to 3.20% per annum.
The majority of Westpac customers are on the Premier Advantage Package, and receive up to 0.70% discount on their home loan.
George Frazis, Chief Executive of Westpac Consumer Bank, said while home loan rates are at historical lows, today’s decision reflects the complex domestic and international environment banks are facing.
“We take a number of factors into account when making interest rate decisions and, in an environment where the cost of funding and deposits are increasing, we have had to balance higher costs, while keeping rates as low as possible for home owners.
“In this low interest rate environment we have changed how we price interest only home loans compared to principal and interest home loans. As a result, we will now offer lower interest rates to customers who make principal and interest repayments to encourage them to pay down their debt and own their home sooner,” Mr Frazis said.
Customers with interest only home loans who wish to move to principal and interest repayments can do so without paying a switching fee until 30 September 2016.
Westpac offers competitive fixed rate home loan offers in the market, with 2 and 3 year owner occupier fixed rates in Premier Advantage package at 3.75% per annum and 3.85% per annum respectively, effective this Friday 5 August 2016.
