“On a typical $300,000, 25 year loan, the required monthly repayment will increase by $18 per month. However, over 90 per cent of our customers will have no increase in their repayment as they are currently paying in excess of their required minimum repayment.”
“We fully understand that any increase in interest rates impacts on our customers and for that reason, have continued to absorb as much of the additional funding costs as long as we could. Unfortunately, we have seen the Bank’s wholesale funding costs remain high and continue to increase as previous long term funding matures and is replaced with new funding at significantly higher cost. At the same time, due to intense competition for retail deposits, the cost of deposits compared to the official cash rate is extremely high,” Mr McEwan added.
The Bank will be increasing a range of Home Loan Fixed Interest rates, reflecting the recent rise in wholesale market interest rates and will also be increasing its Residentially Secured Better Business Loan by 0.10 per cent per annum.
The new variable interest rates for Home Loan and Residentially Secured Better Business Loans will be effective from Monday 15 June 2009 for new and existing customers. The increase in Fixed Interest rates does not affect existing fixed rate customers and is effective for new customers from Monday 15 June 2009.