Westpac

How the Big Four banks stand to make $1BILLION by stubbornly refusing to pass on the variable home loan rate cut

PHOTO: Westpac, ANZ, The Commonwealth Bank and NAB appear to be chasing new home loan business by announcing they would be cutting their fixed rate products, rather than supporting existing customers with variable rate mortgages

Australia’s four major banks look set to make about $1billion in the next 12 months by refusing to pass on the latest rate cut to variable home loan customers.

Cutting the cash rate to a record low 0.1 per cent on Tuesday, Reserve Bank governor Philip Lowe said the economic recovery is up and running and the September quarter national accounts will show positive growth.

Dr Lowe and federal Treasurer Josh Frydenberg said the reduction should be passed onto borrowers.

The cut in the RBA’s cash rate would save more than $30 a month on a $400,000 variable rate mortgage if passed on in full by retail banks.

But Westpac, ANZ, The Commonwealth Bank and NAB appear to be chasing new home loan business by announcing they would be cutting their fixed rate products, rather than supporting existing customers with variable rate mortgages.

The Commonwealth Bank has made history as Australia’s first ever major bank to offer a mortgage rate of less than two per cent. Pictured is a Sydney city branch

READ MORE VIA THE DAILY MAIL

MOST POPULAR