ANZ has opted to take on the short-term market with its one-year special, at 3.95%, which launches this morning. The offer requires customers to have an ANZ account with a linked salary, and borrowers need 20% equity in their home. The offer edges HSBC Premier's 3.99% and is the cheapest offered through the adviser channel. It runs until further notice.
The major lender has also cut the price of its one year carded rate, three year special and carded rates, as well as its four and five year carded rates. The move comes as banks across the market react to the prospect of a possible Official Cash Rate cut after the Reserve Bank shifted to an easing bias last week. Cheaper wholesale interest rates have also underpinned the falling prices.
Antonia Watson, ANZ managing director for retail and business banking,(pictured), said the cuts were prompted by the Reserve Bank's recent comments. “The current low-interest rate environment not only presents an opportunity for new home buyers, but for existing home loan customers to pay off as much of their debt as possible.”
Not to be outdone, Westpac also introduced significant changes this morning. Its three-year fixed rate special has fallen from 4.59% to 3.95%, a drop of 64 basis points. The bank also has a new four year fixed rate special (4.35%), and five-year fixed rate special, (4.45%). However, the long term rates do not match Kiwibank's five-year, 4.29% offer, the cheapest five-year rate on the market.
Westpac's rate drop comes after its economists changed their prediction for the OCR. They now believe rates will fall in May, followed by a further reduction next year.
TSB, meanwhile, has pledged to continue its price match offer as the 2019 price war shows no sign of slowing. The domestic lender's offer to match nationally advertised rates from the big four banks will continue alongside the lender's advertising campaign, aimed at taking business from the Australian-owned major players.