BNZ pushes through rate hikes of up to +30 bps for almost all its home loan rates, and makes modest changes to two selected TD rates under two years

BNZ raises most mortgage rates, including its floating rate.

It has raised its Standard and TotalMoney "variable rate" loans by +15 bps to 5.79%. And it has raised its revolving credit Mortgage One product to 6.40%, and its Rapid Repay product to 5.85%, both rises of +15 bps.

On Monday, Kiwibank also raised its floating rates, by +15 bps.

In addition, BNZ has raised all but one of their rates for fixed rate term mortgages by between +6 bps and +30 bps.*

Its Standard six month rate is now 5.25%, a rise of +16 bps.

Its fixed one year 'special' rate is now 4.49%, up +10 bps.

Its eighteen month fixed rate has been raised by +6 bps to 5.05%.

Its two year 'special' is now 4.79%, a +20 bps hike.

Its three year 'special' is now 5.09%, a +30 bps jump.

Its four year Standard rate is up +24 bps to 5.69%

Its five year standard rate is now 5.79%, a +20 bps rise.

And it is the only bank to offer a seven year fixed rate, which it has raised +16 bps to 6.15%

Today's changes don't change who has the leading carded rates for mortgage borrowers. HSBC Premier still leads for a one year term, SBS Bank now has the leading rates for 2 years, and TSB Bank has the market-leading offers for all terms longer.

At the same time, BNZ has raised five term deposit rates; it has added +5 bps to its 9 month TD rate taking it to 3.65%. It has added +10 bps to its 18 month rate taking it to 3.60%. Rises in rates for term commitments of 3, 4 and 5 years were also announced and these involved +30 and +40 bps rises.

See all banks' carded, or advertised, home loan rates here.

A snapshot from the key retail banks is:

below 80% LVR  1 yr  18 mth  2 yrs   3 yrs  4 yrs  5 yrs 
  % % % % % %
4.25 4.99 4.59 5.29 5.45 5.60
ASB 4.49 4.65 4.79 5.09 5.49 5.69
4.49 5.05 4.79 5.09 5.69 5.79
Kiwibank 4.35   4.54 4.95 5.45 5.55
Westpac 4.25 4.95 4.54 4.79 5.49 5.39
4.39 4.55 4.55 4.89 5.39 5.55
HSBC 4.19 4.29 4.39 4.69 5.09 5.29
HSBC 4.29 4.45 4.39 4.75 5.29 5.45
4.25 4.45 4.49 4.59 4.89 4.99

In addition to the above table, BNZ has a fixed seven year rate which it has raised to 6.15%, a +16 bps rise.

TSB Bank offers a fixed ten year rate at 5.75%.

* = The only BNZ fixed mortgage rate not raised today is their Standard one year rate which remains at 4.89%.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment or click on the "Register" link below a comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current Comment policy is here.


I can understand fixed rates moving, but variable rates. Let's just scrap the Reserve bank. It is null and void.

The rates that banks charge are a function of two elements (1) The cost of funds and (2) the volume of transactions. When, as we did yesterday, you read:

"Barfoot and Thompson data released on Monday showed sales volumes in December falling to their lowest level since 2011."

banks have maintain their return by increasing the margin over the cost of funds - across the board. The more the velocity of the market falls, the higher rates are going to go, regardless of the OCR.

hopefully deposit rates to follow suit

Yes, they also raised these. See second last para in story above. As added detail to the above, BNZ raised its 3 year TD rate from 3.50% to 3.80%, its four year TD offer from 3.60% to 4.00%, and its five year offer from 3.70% to 4.10%.

they still leave their bonus savers untouched eh...

Yes. At call money doesn't really interest banks anymore. Not only is it flighty, savers have enormous amounts in them, far more than banks need, so on a supply-and-demand basis the banks can get away with paying less and less for them. Savers are their own worst enemy - they leave the money there even when they complain. Bankers have a science around this: the replicating portfolio. I call it 'lazy money'. They know this behaviour very well, and know how to profit from it.

One of the reasons they have so much money in oncall accounts, is because oncall rates used to be better or the same as term deposits. Now they seem to be at least 1 point below. But banks do risk people moving their money to another bank, or people instead using they money to put into other forms of investment. So unless banks keep their term deposit rates competitive with other banks, they potentially could lose a lot of their deposits.

Won't be long before all rates are 5+

Rates can go to 6% record lows and house prices will rocket upwards Febuary March.

soapbox anyone? How is 6% record low, when the weighted rate per RBNZ of the entrie NZ book is under that rate?

I think he means that 6% is still a record low, if rates had ever fallen to this level and not 4%. I used to be on like 8.6% fixed for years, 6% would have been fantastic.If you never factored in the rates could get to 6% then you should have fixed for as long as you can. The reason I fixed at 8.6% for 7 years was because anything shooting into double figures would have killed me.I thought the chances of it going lower were non existent, but if your on 4% and were expecting it to go lower your dreaming.

yes but the amount of debt taken on at the "record loads" is the main issue, even a small rise can add to weekly payments beyond some peoples ability to pay.
a lot have not known the levels of interest we have paid in the past, eight years of "record low interest" has led to a false sense of safety

A point often missed! I'd rather pay 9% on a $250k loan than a 'record low' 6% on $800k loan!

That is the whole flaw with the way the housing market in NZ works, and shows how much house prices are way overpriced, as people have been borrowing up to the limit they can afford to service. It as lending really should be done on an earning ratio, as NZers are generally not good with money. If a lot of people who got a mortgage haven't factored in that interest rates rising to 8%+, then there is going to be a lot hurt occurring, and potentially lots of mortgagee sales. But banks need someone to buy and pay for those overpriced houses if they are forced to sell them. So banks been prudent enough in their lending, if people are struggling with these rises? Potentially it could lead to a recession, especially as people will have less disposable income, which could hurt retail in NZ. Over the last few years retailers have had it good.

Well you nailed that one, my 8.6% was on $255K. By the time it hit record lows it was mostly paid off anyway. Its all relative to the amount you borrowed in the first place.Things will get nasty real fast when it starts to climb.

"If you never factored in the rates could get to 6% then you should have fixed for as long as you can. "

Not necessarily Carlos. I think rates will eventually go above 6% but I just take the cheapest rate at the time and budget on paying 10%. If rates go down I just pay more principle, if they go up I pay less principle, but either way my payments remain the same (unless the lowest interest rate goes over 10%). It's about risk management at the end of the day.

I think its a safe bet to start fixing. Unfortunately the longer terms are now starting to rise. Who knows where we will be in 6 months to a year. Even if there was the chance it dropped to 2% you would still fix it because there is a far greater chance it could head into the 6's and above. You need to be able to set it at what you can afford now or your going to get into the shit.

Yes you need to fix it at a rate you can afford. If you fix for a short term you need to be able to cope with what could be significantly higher rates (or not) when that fixed term expires, but it all depends on individual circumstances. For me I would still go for the cheapest rate as rates would have to go above 10% for me to be paying any more each month, so for me I'd take the risk. If I would suffer hardship with a rate of 6-7% in a year or two, I'd personally fix for longer (or fix a good portion for longer). But 7% wouldn't bother me, so I'd fix shorter.

Wait for "THE MAN" to arrive and proclaim (again) that rates will "not get above 6% any time soon, if ever".

Such a muppet.

Muppet Man here.
The rises at the moment are microscopic and it is getting pretty boring with you experts tipping them to increase dramatically when as we know many were tipping them to go to 9 per cent awhile ago,and yet they went the other way.
What mortgage rates do you think the Americans will be paying in a years time?
The U.S. people can not afford high interest rates and they won't allow it to happen as the States is already in the pooh and higher rates will put it in jeopardy of ever being able to repay any debt.
At the end of the day we can all speculate and we have no control over anything that happens worldwide.
All we can do is look after our own backyard and be comfortable with the financial decisions that we make.
If you are happy to not buy a house in Auckland on the basis that prices will drop then stay out of the market.
There is the opportunity to leave Auckland and buy in a more affordable location where your quality of life is superior.
Nothing ventured nothing gained as they say!

you say they are tiny but I know people in Auckland that have big mortgages that come up later this year, who are only just servicing what they have and have been hoping for wage inflation and lower rates to help them along. looks like neither is happening so they will be tightening the belt again.
of course these are OO so they don't have the advantage of squeezing a tenant or writing of expenses for a tax refund to get ahead.
there a lot of big mortgages in Auckland over the last five years and one growth area has been interest only loans as per the RB fiqures

Everyone's circumstances are different.
If investors or speculators have mortgages coming up for renewal shortly then I would say their repayments will be lower as the interest rates currently offered will be less than they are currently paying!
Nothing wrong with interest only loans as it enables better leveraging

the problem with interest only loans is the risk stays. Interest only loans will eventually not be an option. Leverage is what central banks are trying to control.