The Reserve Bank has slashed interest rates to a record low of 0.5 per cent

Yesterday afternoon (2 March), the Reserve Bank of Australia (RBA) lowered the official cash rate by 25 bps from 0.75 per cent to 0.5 per cent – marking the fourth cut since June 2019 when the easing cycle commenced. Currently, NAB has the lowest standard variable rate of the major banks - as it has since September 2018. Other non-major lenders including Macquarie, Suncorp, Newcastle Permanent and Athena Home Loans have also joined in passing the full rate cut to their mortgage holders. Westpac, Commonwealth Bank, National Australia Bank and ANZ Bank all moved to provide their mortgage customers with full relief after the Reserve Bank cut the cash rate to a new historic low of 0.5 per cent ANZ ANZ will decrease its standard variable rates by between 0.25% to 0.35%, effective from 13 March 2020. “The decision by the Reserve Bank to reduce the cash rate to historically low levels highlights the significant impact the outbreak of COVID-19 is already having on the global economy," said Mark Hand, ANZ group executive Australia retail and commercial. Owner occupier P&I cut by 0.25% to 4.54% Investor P&I cut by 0.25% to 5.14% Owner occupiers interest only cut by 0.25% to 5.09% Investors interest only cut by 0.35% to 5.39% For business customers experiencing hardship due to coronavirus, ANZ is offering financial support through suspending interest repayments, providing early access to term deposits without incurring break fees as well as providing access to additional credit. NAB In addition to cutting 25bps across its variable home loan products, NAB has also extended its reductions to its variable small business options loan and business overdraft facilities, all of which goes into effect on 13 March. Owner occupier P&I cut to 4.52% Investor P&I cut to 5.12% Owner occupier interest only cut to 5.09% Investor interest only cut to 5.42% “In making these decisions we have had to consider the unprecedented challenges of the low interest-rate environment and impacts of the bushfires and coronavirus outbreak on our customers and the broader economy,” said NAB chief customer officer for consumer banking, Mike Baird. The bank has cumulatively delivered the largest standard variable home loan rate cuts of the big four over the past 12 months, and maintained the lowest for over a year. CBA CBA's sweeping 0.25% reduction of its variable rates goes into effect last of the majors, on 24 March. On that date: Owner occupied P&I cut to 4.55% Investor P&I cut to 5.13% Owner occupied interest only cut to 5.04% Investor interest only cut to 5.39% “In responding to this latest official interest rate cut, we have examined the important role we play in supporting the Australian economy and the unique set of circumstances facing the country," said Angus Sullivan, group executive of retail banking services. “We also recognise the importance of managing the business sustainably for the long term and balancing the needs of borrowers and depositors. We will continue to review our pricing and make further adjustments as required," said Sullivan. “Today’s announcement means our SVR for owner occupied customers, with principal and Interest repayments, will be one of the lowest on record.” Westpac Westpac will decrease its variable interest rates by 0.25% for home loan customers and small business cash-based loans and overdrafts, effective 17 March. Owner occupier P&I cut to 4.58% Investor P&I cut to 5.13% Owner occupier interest only cut to 5.17% Investor interest only cut to 5.39% “We recognize COVID-19 will have a direct impact on our nation’s economy and we want to provide additional support to our small business and home loan customers at this unprecedented time,” said David Lindberg, Westpac chief executive of consumer. “Our home loan customers can also take advantage of our lowest variable home loan rates in 50 years to help purchase their next home, or pay more off their mortgage faster. “While this is the right decision, pricing changes are increasingly challenging as the cash rate heads towards zero. We will continue to review our rates on a case-by-case basis taking into account the diverse range of stakeholders and factors which influence the cost of funding." Call your local broker to review your current situation on 040 380 3470