Kiwibank first to cut, Westpac follows suit

Thursday 29th January 2009

Kiwibank, as expected, is the first bank to reduce its rates following the Reserve Banks' 150 basis point cut to the official cash rate.

It has cut all its home loan rates and its lowest rate is the key one-year fixed term which has been reduced to 5.69%.

Other major cuts by Kiwibank include the two-year rate being reduced 1% to 5.99% and the variable rate by 0.50% to 6.49%.

Kiwibank has already cut its rates twice this year with chief executive Sam Knowles expressing determination to keep leading the market.

"The last year has been extremely volatile with fixed and variable rates pushing up to and beyond 10%. Now there is some relief in the market and Kiwibank is pushing through the savings for borrowers as quickly as possible."

The rate changes by Kiwibank are: Variable down 0.50% to 6.49%.; six-month down 0.50% to 5.99%; one-year down 0.30% to 5.69%; two-year down 1% to 5.99%; three-year down 0.50% to 6.49%; four-year down 0.30% to 6.69%; five-year down 0.10% to 6.89%.

The cuts are effective immediately (in two weeks for existing variable home loan customers).

Westpac is second out of the gates reducing its floating rate to 6.89% from 7.49% (a move of 1.26%). They also cut six-month rate by 80 basis points, its one-year rate has dramatically dropped by 101 points to a very competitive 5.79%, its two-year rate was reduced by 96 points, its three-year fell by a whole 1% and its four and five-year rates were cut by 59 and 49 points respectively.

Click here to view our rates table in full at Good Returns and click here to graph comparisons.

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