Sharechat Logo

BNZ takes rate war to six-month term

Monday 24th November 2008

Text too small?
Competition in the home loan market has shifted back to the fixed rate terms with the Bank of New Zealand making major cuts to its fixed rates.

Its biggest cuts are to six-month rates for its Standard and Global Plus loans. They have each come down 124 basis points with the Standard rate dropping from 8.59 % to 7.35%.

Its sharpest rate is a new Classic six-month rate of 6.99%. This replaces the one year Classic rate of 7.99%.

The move comes in advance of the Reserve Bank’s next official cash rate announcement which is due next Thursday.

Economists, as reported on Good Returns, are expecting a 100 basis point cut to the OCR, however a couple, including Goldman Sachs JB Were and Deutsche Bank are suggesting the next cut could be has big as 150 basis points.

What is interesting is that a variety of pricing strategies are emerging from lenders as rates fall.

Kiwibank has moved to own the floating rate space, offering a rate of 7.95%.

Well below its nearest competitor, Bank Direct, which is sitting at 8.45%.

BNZ is the leader in the six-month term with its 6.99% Classic product. However, its standard six-month rate is 7.35%, the same as several other banks including ASB and Bank Direct.

At the next term, one-year, many of the banks are sitting around the 7.29%-7.30% mark.

The other characteristic of the market is that several lenders, notably Kiwibank and TSB are offering sharp rates for loans where there is at least 20% equity in the deal

To see what banks are offering and to compare rates go to goodreturns.co.nz MORTGAGE CENTRE.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report