ASB, which was the only major bank to hike all its one to five year fixed-term home loan rates last week, says it's now cutting one to five year fixed rates by between 25 basis points and 35 basis points and in all bar one case is giving back more than it took.
ASB says the cuts are effective from tomorrow, Tuesday August 9, and are a "swift response" to wholesale funding market movements. For its one, two, three, four and five year rates ASB has cut to levels lower than they were at prior to last week's hikes. However, the bank has reduced its 18 month rate to 6.10%, above the 6% it was at prior to the August 3 hike.
ASB is now the market leader for 18 month, three, four and five year rates. See all bank mortgage rates here.
The cuts include a 25 basis points reduction in the one year rate to 5.90% per annum, a 30 basis points reduction in the 18 month rate to 6.10%, a 35 basis points cut to the two year fixed rate to 6.30%, a 25 basis points cut to the three year rate to 6.70%, a 30 basis points cut to the four year rate to 7.05%, and a 35 basis points cut to the five year rate to 7.40%. The fixed-term six month rate is unchanged at 5.85%.
“We are committed to responding in a nimble fashion to wholesale funding market rate movements, therefore providing our customers with highly competitive interest rates on their home loans,” said Catherine McGrath, ASB's chief executive for customers, markets and products.
The bank's floating, or variable, home loan rate is 5.75%.
Before last week's hikes, ASB offered a 5.95% one year rate, 6% 18 month rate, 6.40% two year rate, 6.90% three year rate, 7.30% four year rate, and 7.60% five year rate. That leaves its one year rate 5 basis points lower than it was prior to last Wednesday's hike, its two year rate 10 basis points lower, three year rate 20 basis points lower, four year 25 basis points lower, five year 20 basis points lower, but 18 month 10 basis points higher.