Westpac is now the fourth major bank to drop some of its fixed home loan rates this week.
It comes after Kiwibank lowered some of its rates this morning – and ANZ and BNZ did earlier this week – ahead of next week’s official cash rate decision by the Reserve Bank.
Effective from tomorrow, the bank’s one-year special rate for those with 20% equity would drop 10 basis points to 4.79%, its lowest rate on any term since June 2022.
Its six-month and 18-month fixed special rates would drop to 5.09% (down 20 basis points) and 4.79% (down 16 basis points), respectively.
The one-year and 18-month offers match new rates from ANZ, BNZ, and Kiwibank.
The bank’s standard rates also saw changes. Rates for six-month standard loans dropped 20 basis points to 5.69%. One-year rates would see a 10-basis-point drop to 5.39%, and 18-month loan rates dropped 16 basis points to 5.39%.
Westpac also cut some term deposit rates between 5-month and three-year terms.
“Our reduced shorter-term rates offer great value for customers looking to lock in for a short term, and for those looking for longer-term certainty on repayments, we continue to have the lowest or joint-lowest 3-to-5 year advertised special rates of the five biggest banks,” Westpac NZ general manager of product, sustainability and marketing, Sarah Hearn said.
Kiwibank drops some rates
Effective today, the Kiwibank’s one-year special rate, for customers with a minimum 20% equity, dropped from 4.89% to 4.79%. It also dropped its six-month and two-year special rates from 5.29% and 4.95% to 5.09% and 4.89%, respectively.
New standard rates – for those with less than 20% equity – for six-month, one-year, and two-year loans also went into effect today.
The six-month fixed loan dropped from 6.19% to 5.99%, the one-year fixed loan dropped from 5.79% to 5.69%, and the two-year fixed loan fell from 5.85% to 5.79%.
There were also changes to some of Kiwibank’s term deposit rates for terms between 90 days and two years.
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They fell 10 or 15 basis points.
Rates good news for buyers, bad news for savers
Economist Cameron Bagrie told 1News yesterday that while the recent drops in interest rates were good for buyers, they were not good for savers.
“Banks are trimming rates on both sides of their balance sheet. Term deposit rates have been coming down and in line with mortgage rates. So there’s some winners out there and there’s some losers on the other side,” he said.
“We’ve seen green shoots, but green shoots sometimes turn brown, and there’s a lot of global uncertainty at the moment.”
Hearn said Westpac had heard from its savings customers, who were closely watching rates fall.
“Westpac has absorbed some of these rate reductions over the past year. For example, our 12-month advertised home loan rates have fallen by 2.06% in the past year, compared to 1.80% for our advertised 12-month term deposit rate.
“We also have a 3.00% p.a. rate on our 32-day Notice Saver offering, for customers who don’t need immediate access to their savings.
“Our data continues to show customers managing the cost of living better than expected, but we encourage anyone who’s worried about their finances to talk to their bank.”
