ASB moves both home loan and term deposit rates lower but only for the less popular longer terms. Still, they can claim a competitive three year home loan rate. But they can't claim unique term deposit offers

ASB has trimmed both home loan rates and term deposit rates. But all their moves today (Thursday) are for terms that are not especially popular.

But their new three year fixed three year rate is the lowest of any main bank at 6.65% after a -10 bps reduction. But among challenger banks, that matches Heartland Bank now, and both China Construction Bank and ICBC have lower three year fixed rates still.

Three year fixed home loan rates have risen in popularity, but they remain far less used than one year, 18 month, and two year fixed rates. And if borrowers have the view that future rates might be more likely to be lower on global influences, and "falling" inflation, then longer home loan terms are likely to unattractive to many.

On the term deposit side, savers much prefer short terms of one year and less (six month especially). Falling offer rates for terms of 18 months or longer won't worry many. You can still get 6.10% for six months from Rabobank, 6.20% for nine months from Rabobank and Bank of China, and 6.30% from Bank of China, Heartland Bank, and Rabobank. All of these offers are up to 20 bps higher than any main bank for the same popular terms.

Wholesale swap rates have remained in a relatively narrow range since the big fall lower following the Q3-2023 GDP data released on December 14, 2023. But the 2024 trends haven't yet been set.

Obviously you should negotiate and shop around. Most banks will discount their carded home loan rates if you have strong financials. You shouldn't need them but if you are uncomfortable negotiating, a broker can often be helpful. But be aware some brokers won't offer you the best over the whole market, only the banks they have approved connections to in their "lending panel." And clearly bank mobile managers are there to pitch their company's own product.

They may even offer savers higher than carded rate offers.

One useful way to make sense of the changed home loan rates is to use our full-function mortgage calculator which is below. (Term deposit rates can be assessed using this calculator).

And if you already have a fixed term mortgage that is not up for renewal at this time, our break fee calculator may help you assess your options. But break fees should be minimal in a rising market. They will become important in a falling market however.

Here is the updated snapshot of the lowest advertised fixed-term mortgage rates on offer from the key retail banks at the moment.

Fixed, below 80% LVR	6 mths	1 yr	18 mth	2 yrs	3 yrs	4 yrs	5 yrs
as at January 25, 2024	%	%	%	%	%	%	%
ANZ	7.35	7.39	7.15	6.89	6.75	7.34	7.34
	7.45	7.45	7.15	6.89	6.65 -0.10	6.55 -0.20	6.55 -0.20
	7.39	7.35	7.15	6.89	6.79	6.75	6.75
	7.39	7.35		6.89	6.75	6.69	6.59
	7.39	7.39	7.15	6.89	6.75	6.69	6.49
Bank of China		7.09	6.99	6.89	6.79	6.69	6.59
China Construction Bank	7.19	7.09	6.89	6.75	6.49	6.40	6.40
Co-operative Bank	7.39	7.35	7.15	7.05	6.75	6.75	6.75
Heartland Bank		6.99	6.89	6.85	6.65
ICBC	7.19	7.05	6.95	6.85	6.59	6.49	6.49
	7.55	7.55	7.25	7.15	6.79	6.79	6.79
	7.39	7.39	7.19	6.89	6.75	6.79	6.79

The latest headline term deposit rate offers are in this table after the recent increases.

for a $25,000 deposit January 25, 2024	Rating	3/4 mths	5 / 6 / 7 mths	8 - 11 mths	1 yr	18mth	2 yrs	3 yrs
Main banks
ANZ	AA-	4.30	6.00	6.00	6.10	6.00	5.75	5.50
	AA-	4.40	6.00	6.10	6.10	5.90 -0.10	5.65 -0.15	5.35 -0.15
	AA-	4.30	6.00	6.10	6.10	5.90	5.75	5.50
	A	4.40	6.05	6.10	6.15		5.70	5.35
	AA-	4.30	6.10	6.00	6.00	6.00	5.70	5.50
Other banks
Bank of China	A	5.20	6.10	6.20	6.30	6.10	6.10	6.00
China Constr. Bank	A	5.20	5.70	5.80	5.90	5.85	5.65	5.50
Co-operative Bank	BBB	4.20	6.10	6.10	6.15	6.00	5.80	5.55
Heartland Bank	BBB	5.50	6.05	6.15	6.30	6.10	6.10	5.85
ICBC	A	5.00	6.00	6.05	6.15	6.05	6.00	5.55
Kookmin Bank	A	4.40	5.60	5.70	6.00		5.20	5.20
	A	5.05	6.15	6.20	6.30	6.10	6.10	5.90
	BBB	4.20	6.05	6.15	6.15	6.00	6.00	5.90
	A-	4.25	5.90	5.90	6.00	5.90	5.75	5.50