Non-major banks pass on February rate hike

A raft of non-major banks have followed suit in passing on the Reserve Bank of Australia (RBA)’s 7 February 25-bp cash rate increase.

Soon after the major banks made their new rate announcements, on Friday (10 February), AMP Limited (AMP) followed through with the increase, confirming changes to its variable lending rates for new and existing owner-occupiers and investors.

These changes will be effective from 10 February 2023 for new customers and from 13 February 2023 for existing customers, the bank confirmed.

For new and existing customers (including AMP First), the 0.25 per cent (pa) hike will be added to AMP’s owner-occupied principal and interest rate, its owner-occupied interest-only (IO) rate, its investment principal and interest rate, and its investment interest-only rate, it explained.

In an online statement, it said: “Changes to the official cash rate is one of several factors that impacts our pricing decisions.

“Other factors include the direct implication of the cash rate increase to the cost of borrowing, market conditions, as well as a desire to balance the interests of homeowners and savers.

“We are conscious of the impact of increasing rates on customers and household budgets and remain committed to offering competitive rates to our customers.”

CBA subsidiary adjusts its loan rates

Western Australia-based Bankwest announced changes to its interest rates for some of its home loan and savings products, on Thursday (9 February).

The Commmonwealth Bank Australia (CBA)-owned Bankwest said changes included an increase in the standard variable rate (SVR) for home loans of 0.25 per cent p.a. for new and existing customers.

Its standard variable rates — also referred to as ‘reference rates’ — are “benchmark rates” used to set its home loan interest rates, it explained. “Each variable home loan product is linked to one of our reference rates,” Bankwest added.

The 0.25 per cent increase has been added to its owner-occupier ‘Mortgage Shredder Reference Rate’ and owner-occupier interest-only (IO) ‘Mortgage Shredder Reference Rate’.

Its Investor Variable Reference Rate (or ‘Investor Reference Rate’) and ‘Investor Interest Only Reference Rate’) also received the hike though Bankwest clarified that these reference rates may not apply to a customer’s particular repayment type.

“The reference rate and discount margin applicable to an individual loan is specified in the loan contract,” it advised.

Bankwest said it will also increase the interest rates for select savings products, including by 0.25 per cent to its Variable Hero Bonus Rate (new rate 3.75 per cent p.a.) for balances up to $250,000 and by 0.25 per cent to its Easy Saver Rate for balances up to $250,000 (new rate 4.00 per cent p.a.).

Both home loan and savings interest rate changes are effective 17 February 2023, it confirmed.

“We appreciate and understand the current economic environment is posing challenges for some of our customers, and we are committed to supporting them during this time,” it said.

BOQ responds to RBA’s decision

The Bank of Queensland (BOQ) — adamant in its denial to Mortgage Business of any merger talks with Bendigo-Adelaide bank while its search for new chief executive continues — announced its rate changes on Thursday (9 February).

This will affect its new and existing variable home loan customers from 10 February as it applies the 0.25 per cent (p.a.) jump for new and existing customers.    

“BOQ understands the importance of ensuring customers feel rewarded and can access competitive rates in this environment,” its statement explained.

“For savings customers, BOQ regularly reviews rates on its range of high interest myBOQ accounts.

“BOQ has a range of online resources available including home loan calculators and, for customers experiencing financial difficulty, they are encouraged to contact the dedicated Customer Assistance team.”

ING announces interest rate changes

ING Australia on Thursday (9 February) said the bank will increase all variable home loan rates for new and existing customers by 0.25 per cent per annum.

All variable and fixed rate increases will be effective from 14 February 2023, it confirmed.

Additionally, ING Australia also announced it would increase its highest ongoing variable savings interest rate by 0.25 per cent pa.

“This move means eligible new and existing Savings Maximiser customers could earn a variable interest rate of 4.80 per cent per annum to help boost their savings,” it said.

“There will also be a 0.25 per cent per annum rate increases across ING Australia’s Savings Accelerator offerings (for new and existing customers).”

ING will also increase interest rates across a range of Term Deposits, including its one-year Term Deposit to 4.15 per cent for customers opening or rolling over from the effective date, it explained.

Macquarie updates interest rates

Macquarie Bank (Macquarie) confirmed it was increasing its variable home loan reference rates by 0.25 per cent p.a., effective 22 February. 

It added that it is also continuing to “support Australian savers across a range of deposit products” including Macquarie’s 12-month term deposit interest rate at 4.00 per cent p.a. available now.

“Since January 2022, Macquarie has increased term deposit rates by up to 3.45 per cent,” it outlined.

“Macquarie’s savings and transaction accounts have no minimum balance or deposit requirements, no transaction conditions, and no need to lock money away for a set period to receive the interest rate.

“The ongoing interest rate customers earn on both their savings and everyday transaction accounts will increase to 3.80 per cent p.a., on balances up to $250,000 — effective 22 February 2023.”

MyState completes its rate review

The MyState Bank variable home loan interest rate will move by 25 bps following the RBA decision with the change effective from 20 February, it confirmed.

“The ninth RBA rate rise and its indication that there are more increases to come sets the scene for a challenging 2023 for many home loan holders,” MyState Bank managing director and CEO, Brett Morgan, said. 

“MyState expects short term pain for home loan holders with further rate rises, but we also anticipate some long-term relief with the chance of rate drops towards the end of the year as inflation gets under control.

“We understand that the RBA rate rises will hit many hip-pockets and family budgets hard.”

Last week, MyState Bank lowered rates on its most popular fixed-rates home loans available for new fixed-rate loans, it explained.

With many mortgage holders facing the extra challenge of the fixed-rate term on their mortgage ending this year, MyState is “calling every customer in the weeks before their fixed rate expires and reducing the rates of its most popular fixed loans,” it stated.

MyState’s Bonus Saver account will receive the full RBA’s 0.25 per cent increase, plus a bonus 0.10 per cent, taking the total boost to 0.35 per cent. The change will be effective from 13 February.

Suncorp hikes its rates

On Wednesday (8 February) Suncorp Bank announced new interest rates for home loan and savings customers.

From 17 February, Suncorp Bank will increase variable rate term loans by 0.25 per cent per annum (p.a.), it confirmed.

“This increase means that for every $100,000 of loan balance remaining on a customer’s 25-year variable loan, they can expect their monthly repayments to increase by around $14,” it said.

Effective from 16 February, the Suncorp Bank Growth Saver at-call account interest rate will increase to 4.25 per cent p.a., the non-major bank stated.

Notably, Suncorp highlighted that customers can utilise the savings in their Everyday Options Account and sub-accounts by activating ‘offset mode’ to reduce their mortgage interest costs.

[Related: Big banks move on upped 3.35% cash rate]