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Banks pass on RBA’s March rate hike

The Reserve Bank’s 25-bp rate increase for March has been passed on by the major banks.

Following the Reserve Bank of Australia’s (RBA) 10th consecutive rate hike bringing the official cash rate to 3.6 per cent, all four of the major banks have moved to pass on the new rate.

ANZ announced its variable interest rates across the bank’s Australian home loans will increase by 0.25 per cent per annum, taking effect on 17 March 2023.

In addition, ANZ is increasing the rate available to savings customers on the ANZ Plus Save account for balances less than $250,000 by 0.25 per cent to 4.25 per cent per annum (p.a.).

The change to the variable home loan interest rates will increase monthly repayments by $66 on a variable home loan of $450,000 for an owner-occupier paying principal and interest.

ANZ group executive Australia retail, Maile Carnegie, said: “We understand this latest rate increase, combined with cost of living pressures, might cause some home loan customers to feel greater financial pressure and uncertainty.

“Many Australians continue to look closely at savings rates. We will again increase the rate on our ANZ Plus Save account, taking it to 4.25 per cent p.a., and introduce a new 12-month Advance Notice term deposit rate of 4.40 per cent pa.”

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The Commonwealth Bank of Australia (CBA) is set to increase interest rates on its variable home loans and a number of its savings products by 0.25 per cent p.a., effective 17 March 2023.

CBA’s NetBank Saver five-month introductory variable interest rate and Youthsaver with bonus interest rate will also increase by 0.25 per cent to 4.25 per cent, while GoalSaver with bonus interest rate will increase by 0.15 per cent p.a. to 4.15 per cent.

CBA group executive, retail banking, Angus Sullivan, said the range of savings options provides customers with choices around which product best suits them and can best support their savings goals.

“We know the changing interest rate environment and rising cost of living mean that many Australian households are focused on what they can do to manage budgets, including rethinking some of their spending habits and savings goals,” Mr Sullivan said.

NAB’s standard variable home loan interest rate will increase by 0.25 per cent p.a. as of 17 March 2023.

Additionally, NAB will be increasing the rates for its NAB Reward Saver bonus interest rate by 0.25 per cent p.a. to 4.25 per cent. Its iSaver introductory and standard variable rates will both increase by 0.25 per cent p.a. to 4.25 per cent and 1.60 per cent, respectively.

NAB group executive personal banking, Rachel Slade, said NAB was helping customers struggling to get by, including those facing financial challenges for the first time.

“We know most of our customers are in good shape but, for some Australians, financial difficulty might be an entirely new experience as rising costs put increased pressure on their finances,” Ms Slade said.

“Our support is designed to get our customers through the tough times, and we know that when our customers reach out to our NAB Assist team early for help, more than 95 per cent of them are back on their feet financially within three months.”

Westpac will increase its home loan variable interest rates by 0.25 per cent p.a. for new and existing customers as of 21 March 2023.

Furthermore, the bank’s deposit customers will see rates increase for the Westpac Life standard variable rate and Westpac eSaver standard variable rate by 0.25 per cent p.a. to 4.25 per cent, effective 17 March 2023.

Westpac chief executive of consumer and business banking, Chris de Bruin, said: “To help savers reach their goals we’re increasing the interest rates on our popular Westpac Life and eSaver accounts.

“For home loan customers we understand after a number of successive interest rate rises some people are starting to cut back their spending to help balance the budget.

“We also realise there is a degree of uncertainty in the economic outlook and that is causing concern.”

[RELATED: Official cash rate at 3.6%: RBA]

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