Non-major slashes mortgage rates by half a per cent

A non-major bank has today announced a range of rate cuts across a number of home loan products for both investors and owner-occupiers.

Heritage Bank has today announced reductions of up to 0.50 per cent on new fixed rate home loans for both owner-occupiers and investors.

Owner-occupier fixed rates will reduce as follows:

- 2 year fixed will reduce by 0.15% to 3.84% per annum

- 3 year fixed will reduce by 0.20% to 3.99% per annum

The investor fixed rates reduce as follows:

- 2 year fixed will reduce by 0.50% to 3.99% per annum

- 3 year fixed will reduce by 0.40% to 4.09% per annum

These rate changes will come into effect from 24 August.

Heritage Bank’s focus on growth in the six months to June this year has reportedly helped deliver a 7.1 per cent growth in its mortgage portfolio over the same period, CEO Peter Lock said this week. 

According to the unaudited financial results for the 2015/16 year, released this week, the annualised growth in the mortgage portfolio is above the Reserve Bank’s reported system average of 6.7 per cent.

Although the bank saw an uptake in loan approvals in the second half of the year ($970 million compared to $810 million), loan approvals as a whole were down by 3.26 per cent on last year’s levels, reaching $1.78 billion in 2015/16 compared to $1.84 billion in 2014/15.

Mr Lock said: “Our strategy is definitely to boost our loan volumes in coming years and grow the business as a whole, bearing in mind the need to meet our prudential regulatory requirements in terms of capital.

“Our success in achieving higher growth in the latter half of the year illustrates how well we can perform when we align our organisational efforts toward a key strategic goal. That positions us well to continue pursuing our growth agenda in future.”

The unaudited figures also show a 6.46 per cent increase in pre-tax profit, rising to $51.11 million from $48.01 million. After tax, profit came in at $36.14 million, up 7.53 per cent on the $33.61 million made in 2014/15.

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