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The move will bring ANZ's investor IO variable rate up to 6.26 per cent and 5.75 per cent for owner-occupiers.
ANZ group executive Australia Fred Ohlsson highlighted that the lift in IO rates is not in response to the recently announced bank levy and that ANZ is still to determine the final impact of the tax.
“We do however recognise the work regulators are doing to manage the growth of both investor and interest-only loans and we will continue to be transparent on the impact this will have on how we structure and price our home loan products,” he said.
The bank has also announced a 5-basis point reduction in variable rates for customers paying P&I home loans.
Mr Ohlsson said many Australians are finding it difficult to manage household budgets at present and ANZ is pleased to be able to reduce rates for the majority of its customers.
“While we know those only paying interest on their loans will be disappointed, we need to manage our regulatory obligations and we are now required to hold additional capital against our home loans,” he said.
“We also need to better balance our portfolio towards those paying off their homes. There are clear benefits for our customers to be paying off their loans and we have made this as easy as possible by removing fees associated with moving across from interest-only loans.”
All changes are effective from 16 June.