HSBC's low mortgage rates start to pay off

HSBC's low mortgage rates start to pay off

HSBC, which offers the lowest advertised fixed mortgage rates of any bank in New Zealand and targets wealthy customers, lifted its residential mortgage book by NZ$46.1 million in the September quarter.

The bank's September quarter General Disclosure Statement shows HSBC's residential mortgage book stood at NZ$986 million at September 30, up from NZ$939.9 million at June 30.

HSBC renewed a campaign promoting its premier loans on September 20 after recording growth of just NZ$5 million in the June quarter with John Barclay, HSBC’s head of personal financial services, telling interest.co.nz September quarter growth was looking stronger.

HSBC has been focusing on high net worth customers for the past couple of years having introduced HSBC Premier, its premium international banking service, in New Zealand in October 2008. This came after HSBC sold about NZ$700 million worth of mortgages to Kiwibank in 2007, which it had acquired from AMP four years earlier.

Under the terms of HSBC's premier offering, customers’ must have mortgages worth NZ$500,000 or savings of NZ$100,000 to qualify for a loan.

HSBC advertises lower fixed mortgage rates over six month, one year, two year, three year, four year and five year terms than any other bank. See all bank mortgage rates here. However, these rates are for HSBC's premier customers and it has separate, higher and unadvertised, rates for non-premier customers.

Meanwhile, the percentage of HSBC’s mortgages at loan to value ratios of more than 80% fell to 4.7% at September 30 from 4.9% at June 30.

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