ANZ and National raise mortgage rates

by Richard Kilner

Story link: ANZ and National raise mortgage rates

New Zealand’s ANZ and National Bank have both increased mortgage rates, with variable rates rising by 25 basis points.

The rise takes the rate up to 10.95%, and comes despite no corresponding rate change by the Reserve Bank.

It is not the first time that the two banks have increased mortgage rates without a shift from New Zealand’s central bank.

Back in February, they increased their rates, and were soon followed by the rest of the country’s banks.

Although most banks have rates in double figures, ANZ and National’s variable rate is now the highest in New Zealand.

By contrast, fixed rates, which comprise the majority of the market with a share of 87%, have remained relatively steady.

However in Australia the trend is reversed, with 80% of the mortgage market occupied by variable rates meaning that ANZ’s consumer base in Australia will be more drastically affected.

The move has drawn criticism from both political and consumer quarters, particularly as ANZ made its decision prior to the Reserve Bank of Australia’s announcement on the Official Cash Rate.

ANZ responded by citing the worldwide credit crunch necessitating an increase.