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Most banks have been slow to respond to the October 5 RBNZ +50 bps hike to the OCR. They are only now getting around to making floating rate adjustments with Westpac, and now ASB & BNZ seven days after the OCR change

Personal Finance / news
Most banks have been slow to respond to the October 5 RBNZ +50 bps hike to the OCR. They are only now getting around to making floating rate adjustments with Westpac, and now ASB & BNZ seven days after the OCR change
[updated]
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The rate rise reaction to the Wednesday, October 5, 2022 RBNZ OCR hike has been slow.

Only the ANZ reacted in a timely way, but still two full days later, passing on the full +50 bps to borrowers, and passing on a lesser +40 bps to savers.

Nearly a week later, more banks are finally making their moves. It has been a much slower response than we had expected.

Westpac is the next bank to raise rates, with their floating rate up by the full +50 bps. For existing clients it will be effective on Wednesday, October 26, 2022.

At the same time they have raised their fixed rates, all by +10 bps except their one year rate which stays at 5.45%.

Westpac have also raised both their Bonus Saver and Notice Saver rates by +50%. This rise will be effective Wednesday, October 12, 2022.

And they have raised all their term deposit rates for terms out to 18 months. This takes their six month rate up to 3.60% (+30 bps) and matching many others. It also takes their one year rate to 4.20% (+10 bps), also matching rivals.

Update: ASB has now announced its increase, also +50 bps and matching ANZ. But ASB has raised its Savings Plus by +55 bps on a "full bonus" basis. It has raised its Headstart account rate by +50 bps, and its On Call account by +50 bps. Their Savings Plus bonus interest changes will be backdated to apply from 1 October 2022.  All other personal savings rates take effect from 25 October 2022.

In addition it has added +50 bps to its five month term deposit rate taking it to 2.75%, and +30 bps to its nine month rate to 4.00%. (These two rates are updated again after an error in the ASB announcement.)

Further update: BNZ has announced their rise as well, which will be effective for existing borrowers on November 2, 2022. They made no savings account changes with this announcement.

Here is the running tally of bank changes to floating rates which we will update as each announcement is received.

Floating mortgage rates Prior rate change New rate Existing customers,
  % bps % effective date
         
RBNZ OCR 3.00 +50 3.50 5 October 2022
         
ANZ 6.84 +50 7.34 25 October 2022
ASB 6.84 +50 7.34 25 October 2022
BNZ 6.79 +50 7.29 2 November 2022
Kiwibank 6.50 +50 7.00 31 October 2022
Westpac 6.85 +50 7.35 26 October 2022
         
Cooperative Bank 6.65 +50 7.15 1 November 2022
Bank of China 5.45      
China Construction Bank 6.50      
Heartland Bank 4.99      
HSBC 6.79      
ICBC 6.00      
SBS Bank 6.79      
TSB 6.75      

We will separately report the fixed rate increases when some arrive.

We welcome your comments below. If you are not already registered, please register to comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

21 Comments

7% Interest Rates This Year, Guaranteed !

 

The Celebration Continues.   In remembrance of The Prophet.  May he RIP.

Interest Rates are going 7 and Up.

https://www.youtube.com/watch?v=TsXfhnTkCNs

 

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11

Brock give it a rest mate. Why so many profiles?

 

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6

No. Just me.

St Landers is also his own man. 

Join in the celebrations.  Unless you are an RE Agent , then I guess its not much fun.

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11

Give what a rest?

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1

Should we really be surprised by the slowness of the banks in raising rates, given the mortgage market is getting so much more competitive with the dire state of the housing market?

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3

I've been talking to people I know who operate in residential construction, there are practically no sales at all of new homes.

So you may be bang on right about mid 2023 being peak brown trouser material.

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9

if they cannot rent them out they will have to sell at whatever price they can get

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3

Well I work in and around the sector and the views I have stated here for many months have been based on what I have heard ‘on the ground’…so pretty well informed.

But according to some I don’t know what I am talking about in terms of urban development and economics.

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1

Yes I've been contacted twice in the last week from home builders asking me if I'm interested in buying one of their homes.

One of them sounded desperate and wouldn't take no thanks as a reasonable answer. Apparently, I needed to buy one from them to ensure my financial future. 

The last time this happened was in April 2020. 

 

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5

Hi Independent_Observer,

Your latest fabrication, above, doesn't come across as being too convincing.......

Try harder next time, old chap.

TTP

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4

I was contacted by someone probably about 3 months ago.

They sounded desperate. It was then that I knew the writing was on the wall.

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2

dragging the chain seems to be normal business practice for some,quick to collect and slow to pay out.

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3

Carded rates starting to push above the test rates of yester-year could be a reason for the delay?

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8

Pretty much what I think too.

The next move will take the interest rates of the bank above what they declared as "stress" when they tested their customers.

Which means a lot...

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3

TA has been rabbiting on over the past couple of months that fixed rates wouldn’t go any higher. What a crock 

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3

The likes of TA and AC are now so discredited that the mention of their names around me,  gets laughter and scorn.
What they have advised average Joe punters over the last 3 years - will possible destroy lives and lead to financial ruination!

Should the FMA investigate their actions and insider, vested interest activities?

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3

Hurry the hell up Kiwibank

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2

1000s are moving out of nz 

 

that’s what, investors be happy …. U just killed the duck (real estate) which lays the golden egg,

greed 

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2

"Oh no, my investment carries risk, that's not fair, everyone else should underwrite my attempts to monopolise the provision of shelter, and when it turns out that's actually not a good thing, I'm going to piss my pants over it"

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0

Reserve Bank needs to be compelled to implement a Funding for Lending clawback scheme to recapture the profit gifted to banks from the idiotic initiative of the governor and his merry team. That would help to get rates moving up

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0

Bankers back bankers. Sweet sweet flp digits, good for mre record profit

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1