AUSTRALIA and New Zealand Banking Group (ANZ) is the last of the big four banks to hike standard variable interest rates.
ANZ will lift rates for home owners by 0.18 percentage points to 5.56 per cent effective from November 20.
It is the last bank to announce an increase after NAB announced this morning that all new and existing variable rate home loans would be increased by 0.17 per cent to 5.60 per cent per annum effective from Thursday, November 12.
The Commonwealth Bank previously announced that it would increase its rate by 0.15 per cent to 5.6 per cent and Westpac would raise its rate by 0.2 per cent to 5.68 per cent.
The rates increases are in response to market conditions and regulatory changes that require NAB to increase the amount of capital applied to residential mortgages.
Gavin Slater, NAB’s Group Executive for Personal Banking, said the bank had carefully considered the decision before raising interest rates, which are at “historically low levels”.
“There are a range of factors that come into consideration in interest rate decisions. The home loan market is dynamic, with multiple changes being seen across the industry,” Mr Slater said.
Tough decisions ... National Australia Bank’s Group Executive for Personal Banking Gavin Slater and Executive General Manager for Micro and Small Business, Leigh O'Neill at their offices in Docklands. Picture: Aaron FrancisSource:News Corp Australia
“Regulatory changes on capital requirements also increase the costs associated with providing home loans. In May this year, NAB took early steps to strengthen our capital position by raising $5.5 billion to begin to address expected changes in capital requirements.
“Today’s decision has not been easy, but we believe this is right decision for the long term. We know we have to balance the interests of our customers with the needs of our more than 550,000 shareholders.”
Mr Slater said NAB appreciates that price is important but they also know that customers want the right help and advice, as well as the right products and innovative digital capability.
There will be no changes to fixed-rate loans, after the company cut its two, three and four-year fixed home loan rates earlier this year.