Two of the big four banks have ignored pleas to pass on the Reserve Bank’s record low cut to interest rates, leaving many home loan customers high and dry.
The country’s biggest bank, Commonwealth Bank, said on Wednesday it would slash its four-year fixed rate home loans to 1.99 per cent, but variable home loan rates would remain unchanged.
“We have reflected this in our interest rate settings, offering customers our lowest ever fixed rate – 1.99% fixed for four years – providing customers who fix some or all of their home loan with certainty and confidence into the future,” the bank said.
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“We have also reduced the one, two and three year fixed rates for new owner-occupier loans by 10-15 basis points to 2.14 per cent.”
Westpac followed suit shortly after by saying it would also be dropping their four-year fixed rate for owner occupiers paying principal and interest to 1.99 per cent, but again, those on variable loans miss out.
They are also slashing their one, two and three-year fixed rates down to 2.09 per cent.
The Reserve Bank of Australia cut the cash rate on Tuesday by 0.15 percentage points to a historic low of 0.1 per cent, in a bid to help the Australian economy out of the COVID recession.
If passed on in full by the banks, it was estimated to save those on the average mortgage of $400,000 around $33 a month.