By Leith van Onselen
Just in, Westpac Banking Corporation (WBC) has cut its variable mortgage rate by 0.37%, which follows the Bank of Queensland’s, National Australia Bank’s, and the Commonwealth Bank of Australia’s announcements that they would reduce variable mortgage rates by 0.35%, 0.32%, and 0.40% respectively. WBC also announced that it would cut interest rates on variable loans to businesses by 0.5%.
From the WBC media release:
Westpac today announced it will reduce interest rates on variable rate loans to businesses by 0.5 percentage points and cut its standard variable mortgage rate by 0.37 percentage points to 7.09 per cent. The new rates are effective from 14 May 2012.
The cuts will help companies, particularly small and medium-size enterprises, drive economic and jobs growth. The 0.5 percentage point reduction in the cost of variable rate business loans comes as Westpac this week launched National Business Month.
Customers on Westpac’s Premier Advantage Package who receive a minimum 0.7 percentage point discount on the headline standard variable mortgage will see their new effective rate fall to 6.39%.
The reduction in home loan rates will save homeowners $900 a year in total monthly repayments on an average mortgage of $300,000. Since October 2011, Westpac has cut its variable mortgage rates by 0.77 percentage points, equating to an annual saving of $1,900 on an average home loan.
Westpac Group Executive Retail and Business Banking Jason Yetton said: “We want to continue to help both our business and mortgages customers, while maintaining attractive high interest rates on deposits.
“We feel it is particularly important to help small businesses at this time. If business is doing well, it follows that we’re all doing well. At the same time, we understand the need to keep mortgage rates as low as possible and continue to reduce rates for homeowners.”
The new standard variable rate is the lowest offered by Westpac since April 2010 and it is the biggest single reduction in more than three years.
Mr Yetton said that while there continues to be a focus on the headline standard variable rates, more than 90 per cent of Westpac home loan customers were paying far less than that amount because of the discounts offered under the Premier Advantage Package.
