There have been a lot of home loan rate changes this week and the latest has come from ASB.
So its time to update where we stand.
Firstly, TSB has matched ANZ with a 5.69% floating rate. That is not as low as Kiwibank's 5.65% and it is this 5.65% that Co-operative Bank has chosen to match.
ASB previously cut its floating rate to 5.70%, but today (Friday) announced that starting next week, it would roll out further fixed rate reductions.
Their one year 'special will drop by -14 bps to 3.95%. While that is a good new rate, it is not as good as the 3.89% ANZ has carded (and that TSB has matched).
For two years fixed, ASB is adopting the 3.89% rate, a -10 bps reduction, lower than all rivals other than the outlier 3.69% rate from China Construction Bank.
The final change ASB has announced is actually an increase, taking its three year 'special' up from 3.95% to 4.05%. Five other banks, including Westpac and Kiwibank have a three year carded offer of 3.99% or lower.
Challenger bank Co-operative Bank, has also cut rates. As noted above, Co-op has a market-leading floating rate. But its other offers are not at that level even if they are still competitive. And remember, Co-op is the only bank to offer 3.99% for six months fixed, a clear market leader.
Wholesale swap rates have not been moving lower today (Friday), but since the start of May the falls have been about -5 bps for all tenors. Since the start of April, the falls have been -7 bps for one year, but negligible for all other durations. Wholesale money movements are not driving recent rate cuts to any significant extent. And remember, wholesale funded HSBC has ended its 3.69% two year fixed offer today.
Kiwibank has the lowest four and five year rates still, positions it established well before the recent RBNZ official rate cut.
Here is the full snapshot of the advertised fixed-term rates on offer from the key retail banks.
|below 80% LVR||Floating||1 yr||18 mth||2 yrs||3 yrs||4 yrs||5 yrs|
|as at May 10, 2019||%||%||%||%||%||%||%|
|China Construction Bank||5.80||5.10||3.65||3.90|
|with price match promise||5.69||3.89||4.09||3.89||3.95||4.35||4.45|
In addition to the above table, BNZ has a fixed seven year rate of 5.95%.