Sister banks SBS Bank and HBS Bank have cut their two and three-year fixed term home loan interest rates by 10 and 20 basis points respectively.
SBS and HBS, the former Hastings Building Society which is now an operating division of SBS after being acquired in 2010, have cut their two-year rate by 10 basis points to 5.79% and three-year rate by 20 basis points to 6.25%.
The moves bring the SBS and HBS two-year rate close to the lowest rate advertised by a bank, which is TSB Bank's 5.78%. Kiwibank, ASB, sister banks ANZ and National, plus Westpac, all also offer 5.79% advertised rates.
The new SBS and HBS three-year rate is still 15 basis points above the lowest advertised bank three-year rate which is ASB and Kiwibank's 6.10%. The Co-operative Bank, formerly PSIS, is close behind with 6.15%. See all advertised bank home loan rates here.
The cuts come after SBS and HBS trimmed their six month fixed-term rate by 10 basis points to 5.65% and one-year fixed-term rate by 5 basis points to 5.70% last month.
The majority of residential mortgage borrowers are currently on floating, or variable, rates. And, on top of the NZ$103.761 billion, or 61%, of banks' on-balance sheet residential mortgages floating, another NZ$40.232 billion is fixed for a term of less than a year, meaning NZ$143.993 billion, or 84%, worth of on-balance sheet residential mortgages are either floating or up for renewal during 2012. Banks hold just NZ$281 million worth of mortgages off balance sheet, the Reserve Bank says.
Standard advertised bank floating rates currently range from 5.60% to 5.79%.
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