ANZ 1st out of blocks after OCR hike

ANZ lifts floating and flexible mortgage interest rates, and 'serious saver' deposit rates, all by 25 basis points

12th Jun 14, 10:27am by Gareth Vaughan

<a href="http://www.shutterstock.com/">Image sourced from Shutterstock.com</a>

ANZ has again wasted little time in reacting to the Reserve Bank's Official Cash Rate increase, lifting its floating and flexible home loan rates by 25 basis points and its "serious saver" deposit rate by the same amount.

The moves lift its floating mortgage rate to 6.49%, its flexible rate to 6.60% and its serious saver rate to 4.50%. The increases take effect for the floating rate from Monday, June 16, and June 30 for the flexible rate increase, and July 1 for the serious saver increase.

"Retail interest rates are shaped by a range of market and economic factors, of which the OCR is one," ANZ says.

"The Reserve Bank has signalled a series of further increases in the OCR, reflecting its confidence that the economy is rebounding strongly. This will further affect interest rates for New Zealand consumers. It would be sensible for anyone with a home loan, or anyone considering one, to make sure their budget is planned so they can comfortably manage further increases in interest rates."

The Reserve Bank this morning increased the OCR for the third time this year, to 3.25%. ANZ was also the first bank to lift rates after the OCR hikes in March and April.

See all banks' carded, or advertised, home loan rates here.

ANZ's new floating home loan rates compare with their main rivals today as follows:

below 80% LVR	Floating	Revolving
		Credit
	6.49%	6.60%
	6.25%	6.25%
- Total Money	6.24%
- Standard & FlyBuys	6.34%	6.34%
Kiwibank	6.15%	6.15%
	5.99%	6.25%

Co-op Bank	6.20%	6.20%
	6.39%	6.70%
	6.15%	6.15%
TSB	6.29%	6.04%

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Source: interest.co.nz

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8 Comments

by Boatman | 12th Jun 14, 10:41am 1402526480

There are 3 certainties in the world , death , taxes , and ANZ BANK will be the first to put up mortage rates after an OCR increase , and the last to lower them when the OCR comes down

by Chairman Moa | 12th Jun 14, 12:10pm 1402531831

If you ever have the opportunity to visit Melbourne, check out the carpark at ANZ Head Office in the CBD.. a fleet of expensive Jags and a couple of Aston Martin.. Now you know they are raisig the mortgage rate for a very good cause..

by ngakonui gold | 12th Jun 14, 10:43am 1402526620

Friend just called to say that Torchlight Fund operated by George Kerr is in recievership.Thats all i know.

by ngakonui gold | 12th Jun 14, 1:10pm 1402535434

Denial on the NZX of recievership.Who really knows.Smoke and mirrors perhaps?

by Pureant | 12th Jun 14, 5:17pm 1402550227

Comon Rabobank an BNZ, crack into it!

by Stanley123 | 15th Jun 14, 8:05pm 1402819520

Tell me, when the OCR goes up 0.25% and the banks put up their floating rates by 0.25%pa, I believe that this goes straight into their profits, aside from the extra amount they have to pay on savings accounts.

I have been told that banks mainly are funded from overseas where the lending rates are low eg 1%, 2% etc.

It seems that the Reserve Bank is in effect just making more money for the big Australian banks and taking from the pockets of hard working Kiwi families. Aside also from taking away from the revenue of exporters by way of a rising exchange rate while encountering a 26% drop in dairy prices at the time time.

How does the RBNZ justify the financial stress they cause a large chunk of New Zealand when they are trying to control higher house prices in Auckland while many parts of the country have falling prices eg Greymouth, Hasting and Whanganui to name a few?

The Government advertises NZ as a place to immigrate to, and then when the immigrants arrive to Auckland mainly and put pressure on housing, they penalise everyone for it.

A better solution would be for the Government to incentivise employers to relocate some of their workplaces to small towns gradually. Eg, if every one of the banks, insurance companies and internet companies who hire say 50 people in a call centre every year opened a small additional call centre in Whanganui or hastings, this would create jobs in smaller places and at the same time redistribute the housing pressure elsewhere and overall more evenly across NZ.

by MortgageBelt | 15th Jun 14, 8:52pm 1402822347

Yes, the impact in regional areas will be worse than last time. With little impact on Auckland house prices, the hikes will hit small businesses, exporters, wage/salary earners with mortgages, and will prop up a high NZ dollar.

One wonders if the RBNZ has NZ best interests as the main priority.

When banks profit while small business and households suffer.

A local accountant has graphed interest rates from 1990 to 2013 against house prices. Not much correlation. However, migration charted to house prices has a much clearer correlation. Of course, correlation does not necessarily mean causation, but it makes you wonder if hiking actually achieves the stated aims anyway.

by Grant A | 15th Jun 14, 9:49pm 1402825775

Stanley - you might have been told right, but accidently mislead. Banks generally raise offshore funds in the currency of the country accessed, typically USD or EURs. However, they certainly do not carry currency risk in doing so e.g. the NZ private sector borrowers (kiwi fruit farmers) of the 1980's who borrowed 4% Swiss Francs, probably 15% plus below NZ rates at the time, but took massive hits when the NZD fell and they had to repay with low value NZDs. Banks always swap their foreign currency borrowings into NZDs when they borrow the money, and the FX swap costs are exactly the interest rate differential between the two currencies i.e. depending upon the term, borrow USDs at 1%, pay 3% FX swap costs, and youve raised 4% NZ equivalent money (plus the funding cost charged to banks these days when they lend to each other) .

Youre right that if theyre raising borrowing rates, and not raising deposit rates by the same extent, then their margins will go up - but there's two parts to the equation for banks, margins and volume. Competitive pressures quickly hit those margins as they all compete for volume/and market share, just look at what happened to fixed rates these past two months (down to March MPS levels) until the RBNZ fired at warning shot at them on Thursday