Kiwibank reverts its 2-year 'special' to 4.65% but replaces its fighting position with a 1-year 4.29% fixed home loan rate, the lowest of all the majors for that term

Kiwibank is back with a new competitive home loan rate.

It has announced a 4.29% one-year fixed rate 'special'. This is a -6 basis points reduction from the bank's previous rate.

It is also the lowest level of any one-year advertised rate in the market at present, other than the 4.19% HSBC Premier offer.

It has nudged ASB's 4.30% rate off that position, and is -6 to -10 basis points lower than the advertised, or carded, offers from the other large banks. And it bests all the challenger banks (other than HSBC Premier).

At the same time, Kiwibank has ended its competitive 4.49% two-year offer, letting that rate revert back to 4.65% in line with all other majors. BNZ did the same earlier in the week.

The BNZ move came with a few rises in key term deposit rates - so far, there has been no equivalent announcement from Kiwibank of term deposit rate changes.

(Kiwibank's standard one-year rate is 4.79%, if you can't meet their condition of 20% equity in the property being borrowed against).

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

Here is the full snapshot of the fixed-term rates on offer from the key retail banks.

below 80% LVR 6 mths  1 yr  18 mth  2 yrs   3 yrs  4 yrs  5 yrs 
as at March 23, 2018 % % % % % % %
4.99 4.35 5.15 4.65 4.99 5.89 6.09
ASB 4.95 4.30 4.39 4.65 4.89 5.39 5.59
5.35 4.39 5.05 4.65 4.99 5.89 6.09
Kiwibank 4.99 4.29   4.65 4.99 5.65 5.69
Westpac 5.25 4.39 5.15 4.65 4.94 5.89 5.59
4.80 4.39 4.69 4.69 4.99 5.39 5.59
HSBC 4.85 4.19 4.19 3.95 4.89 5.29 5.59
HSBC 4.99 4.35 4.59 4.64 4.99 5.49 5.55
4.85 4.49 4.65 4.39 4.89 5.55 5.69

In addition to the above table, BNZ has a fixed seven year rate which is 6.15%.

And TSB still has a 10-year fixed rate of 6.20%.

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HSBC's 2 year rate really stands out doesn't it. You have to wonder how they can be 15% cheaper than the big 4 banks.

Just remove all sense of customer service and make nearly impossible to close an account with them.

Could be true, in light of their amazing 2-year rate, I contacted them a month ago to see if it was worth shifting my loans over to them... their manager never replied, so I thought "if that's the service I'm going to get, I'll stay with ANZ"

That's how they offer such a low rate, they have no service overheads like staff or branches. They have very restrictive criteria for their services as well, basically they're just not interested in the loan portfolios most residential borrowers have and just want the cream off the top.

Interesting anyone is cutting rates when swap rates are trending the other direction currently.

Also, compare apples with apples -- there is the $500k+ premium criteria. What happens when you pay your loan down? Also, all of their advertised rates don't apply to existing loans per their ts and cs

HSBC , for all their sins, are really a very good bank, and a 2 year mortgage fix at 3,95% is a real winner .

Their customer retention is actually quite high, which indicates good customer satisfaction , even though they dont offer a stand -alone transactional service

what's your basis for asserting customer retention is high? Anecdotally I have heard of man y HSBCers refinancing out. Is there some sort of report?