ASB has today (Thursday) raised its fixed home loan 'special' interest rates.
Its one year rate has been raised by +4 basis points to 4.29%.
Its 18 month fixed rate has been also been raised by the same amount.
Its two year fixed rate is up +5 bps to 4.34%.
And its three year fixed rate is also up by +5 bps, now at 4.39%.
These new rates will become effective at 8am, Friday, October 7
The new rates only affect their mortgage 'specials', and they also apply to home loans offered by their BankDirect brand. Expect a similar move from Sovereign, and possibly by NZ Home Loans.
These new ASB rates leave it relatively competitive for a three year term (although rival Kiwibank has a lower rate), but leave it exposed somewhat against ANZ who dominate this market.
This rise follows a very similar rate announcement from The Co-operative Bank late on Tuesday. The Co-operative Bank were clear their move had a lot to do with "elevated" term deposit rates and competition in that segment.
Wholesale swap rates have been rising over the past four or five days, driven higher by moves in benchmark rates on Wall Street. Local swap rates have risen again today.
On October 1, there was a major transition in US credit sources with many money market funds removing themselves from offering foreign banks funding lines following a key regulatory change. This is also affecting the cost of credit, and may have had a role to play in the ASB decision.
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In addition, BNZ has a fixed seven year rate of 5.55%, while TSB Bank offers a fixed ten year rate at 5.75%.