Major bank slashes fixed rates

Westpac Bank has reduced its two-year standard fixed rate owner-occupier loan (principal and interest) on its premier advantage package by 20 bps.

The bank has cut the rates from 2.09 per cent per annum to 1.89 per cent per annum (comparison rate of 3.46 per cent).

It has also decreased its three-year fixed rate loan by 11 bps, from 2.09 per cent per annum to 1.98 per cent per annum (comparison rate of 3.38 per cent per annum).

In addition, the bank has decreased its two-year investment property (principal and interest) loan by 20 bps, down from 2.49 per cent per annum to 2.29 per cent per annum (comparison rate of 3.97 per cent per annum), while its interest-only fixed rate investment loan has been reduced from 2.59 per cent per annum to 2.49 per cent per annum (comparison rate of 4.21 per cent per annum).

The bank said the comparison rate is based on a loan of $150,000 over a 25-year loan term.

The group has also made interest cuts across its subsidiaries (St.George, Bank of Melbourne and BankSA).

The bank’s two-year owner-occupier home loan (principal and interest) standard fixed rate has been reduced by 20 bps to 2.04 per cent per annum, while the fixed rate for a three-year loan has been reduced from 2.24 per cent per annum to 2.13 per cent per annum.

Comparison rates vary across the subsidiaries, with Bank of Melbourne offering a 4.26 per cent per annum rate across its two-year loans and 4.08 per cent per annum rate across its three-year loans; BankSA, offering 4.27 per cent per annum across its two-year loans and 4.09 per cent per annum across its three-year loans, while St.George is offering a 4.28 per cent per annum rate for its two-year and 4.10 per cent per annum rate for its three-year loans.

Meanwhile, the standard two-year residential investment home loan fixed rate (principal and interest) has been also been reduced by 20 bps to 2.44 per cent per annum (comparison rate 4.79 per cent per annum), while the interest-only residential investment home loan has been reduced from 2.84 per cent per annum to 2.64 per cent per annum (comparison rate 5.06 per cent per annum).

According to Westpac Group, the fixed rate interest rates are applicable to new fixed rate home loan and existing variable rate home loan customers seeking to fix all or part of their loan.

The reduction in the group’s fixed rates have come as the Reserve Bank of Australia (RBA) decided to hold the official cash rate at 0.10 per cent in its monthly meeting for March.

The central bank also brought forward bond purchases under the bond purchase program, with governor Philip Lowe stating in his monetary policy decision statement that it would be willing to make more changes to its purchases if necessary.

National Australia Bank also recently announced cuts to its fixed rate home loans of up to 55 bps, while the lowest rate for its three-year and four-year fixed rates was at 1.98 per cent per annum.

[Related: Lenders extend cashback offers]

Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.

Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.