ANZ has followed BNZ, Westpac and ASB by raising its floating mortgage rate by +10 bps to 5.79%.
This leaves ANZ's floating rate below two of its main rivals and above the other two.
The last time ANZ raised its floating rate was on January 6 and this latest change pushes this rate back to levels we last saw in December 2015 when the rate was 5.99%.
Along with the floating home loan increase, ANZ has raised its Flexible Home Loan revolving credit rate by +10 bps to 5.90%, and its Business Flexible Facility by the same increase to 5.79%.
ANZ last raised fixed rates on January 6, 2017.
The changes by all the large Australian-owned banks leaves Kiwibank with by far the best floating mortgage rate of any of the majors - or even compared with the second-tier banks. (It is hard to see Kiwibank holding this lower-than-market position, especially given that they do have issues with relatively low profitability.)
For perspective, here is the recent change history for ANZ's Total Money product:
|ANZ change history||Change||Floating|
|Start of 2016||5.74|
|March 11, 2016||-0.10||5.64|
|August 12, 2016||-0.05||5.59|
|January 6, 2017||+0.10||5.69|
|March 6, 2017||+0.10||5.79|
It is very hard to see how this current round of floating rate rises can be justified. Wholesale money costs are not rising at the short end. (They did rise in mid 2016 because of factors bank treasurers knew about for many months and were prepared for. But that is not the case recently.) Banks may be under margin pressures but these pressures are not margin rate pressures; they are margin volume pressures. Making customers pay for that seems hard to justify. ANZ has raised some term deposit rates and these will raise their costs. But most of their term deposit rates are not rising. And none of their savings account rates are rising. And most of ANZ's household deposits will be for terms of nine months and less and be at average rates that are very low.
And here is a snapshot of the current floating rates by the key retail banks:
|below 80% LVR||Floating|
At the same time, ANZ has raise some selected term deposit rates. Its 90 day rate has risen +15 bps to 2.75%, its eight month term deposit rate is up by +10 bps to 3.60%, its eighteen month term deposit rate has been raised by +15 bps to 3.75%, and its two year term deposit rate is up +10 bps to 3.90%.
There are equivalent term PIE rate changes too.
All these changes are effective from Monday, March 6, 2017, except for existing floating rate clients who will see their rate rise on Monday, March 20, 2017.