All of the majors have now increased their rates out of cycle with the Reserve Bank of Australia (RBA), with the National Australia Bank and Commonwealth Bank of Australia announcing their interest rate adjustments yesterday afternoon.
The Commonwealth Bank of Australia said it would lift its variable mortgage rate by 0.10 per cent to 7.41 per cent, effective 20 February.
National Australia Bank lifted the interest on its standard variable rate mortgages by 9 basis points to 7.31 per cent.
NAB still boasts the cheapest standard variable rate of all the majors, followed closely by ANZ which has a rate of 7.36 per cent.
Westpac continues to have the most expensive standard variable rate of all the majors, sitting at 7.46 per cent.
The majors’ decision to raise their rates independent of the RBA finalises the divorce between the bank’s interest rates, and the official cash rate.
CBA retail banking services executive Ross McEwan said the official cash rate was now just one factor in the bank’s total funding costs, and the bank has been subject to sustained increased in outlays for wholesale and deposit funding.
“The Commonwealth Bank believes Australian banks should continue to price sensibly, taking into account factors both on and offshore, rather than experience similar problems to those that many banks overseas have experienced,” Mr McEwan said.