ANZ goes 27bps!

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From our second RBA today comes the news that they’ve added on 2 basis points to the RBA cut:

ANZ May 2013 Interest Rate Review

– Reduces variable mortgage rate by 0.27%pa –

ANZ today announced it will lower interest rates for variable rate mortgages by 0.27%pa following its monthly interest rate review.

Effective Friday 17 May, ANZ’s standard variable rate will be 6.13%pa (6.23%pa comparison rate). The 0.27%pa decrease will save customers about $60 per month or $750 per year for the average home loan of $280,000.

Standard Variable Mortgage Interest Rates for Major Banks ANZ Westpac CBA NAB 6.13%pa 6.26%pa 6.15%pa 6.13%pa

ANZ CEO Australia Philip Chronican said:

“This month we reviewed a range of factors including the Reserve Bank’s decision to decrease the official cash rate this week, our competitive position and a recent easing in the cost of our wholesale funds.

While competition for deposits remains strong, our overall funding cost position has allowed us to reduce variable mortgage rates by 0.27%pa.

This decision reflects ANZ’s approach to reviewing retail lending rates each month which includes an assessment of our overall funding costs and I’m pleased our mortgage customers will see a benefit this month,” Mr Chronican said.

ANZ also said that variable rates for small business lending would decrease by 0.25%pa.

This is obviously a marketing stunt rather than a break from the oligopoly pricing range, as clearly shown in ANZ’s own assessment of the Standard Variable Rates across the majors.

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I guess customers may as well have it but I’d rather see it put towards some permanent bps charge for all the guarantees the banks enjoy.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.