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Kiwibank and ASB lift rates

Kiwibank has joined ASB in announcing it will lift its variable home loan interest rates.

Both banks said the increases were in response to the Reserve Bank Te Pūtea Matua’s increase in the official cash rate. ASB said it would increase its floating home loan rate from 7.35% to 7.99% on Wednesday, while Kiwibank said it would lift its variable rate from 7% to 7.75% on Monday. The rises compare with the increase in the official cash rate (OCR) by 75 basis points to 4.25% on November 23.

Earlier this week, ANZ and Westpac banks increased home loan interest rates by up to 55 and 50 basis points respectively.

ASB said it would also increase some deposit rates, including increasing the interest it pays on its Savings Plus deposit account, and its children’s Headstart account from 2.8% to 3.55%, though the increase for the Savings Plus account won’t happen until January 1.

ASB also increased term deposit rates, including lifting the rate on its 36-month term deposit to 5.3%.

‘‘Following last week’s OCR change, many of our customers will benefit from higher deposit rates which will help those on fixed incomes with cost of living increases,’’ said Adam Boyd, ASB executive general manager for personal banking. ‘‘We have also chosen not to pass through the full impact of the OCR increase for Back My Build loans. These customers are constructing new homes and have experienced rapid increases in building costs,’’ he said.

Kiwibank also planned to increase the interest it pays on its savings accounts and term deposits, with the changes to its term deposit rates kicking in immediately.

The bank’s 90-day term deposit rate for deposits of $10,000 or more went from 2.25% to 2.7%.

Rising home loan rates are putting pressure on household budgets, however, most households have the majority of their home loans on fixed rate terms.

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2022-12-03T08:00:00.0000000Z

2022-12-03T08:00:00.0000000Z

https://fairfaxmedia.pressreader.com/article/282102050697072

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