09-May-2016 • Corporate
ME today announced it will decrease interest rates on its variable home loan products by 5 basis points, effective Monday 16 May.
The decrease will put the Bank’s Flexible Home Loan variable reference rate at 5.03% p.a. (comparison rate 5.05% p.a.), positioning it between 0.32%-0.40% p.a. lower than the major banks.
ME CEO, Jamie McPhee, said “in making this decision we have sought to balance continued low rates for customers and provide an acceptable return on capital for our shareholders in the context of a significant and sustained increase in the cost of funding over the last six months.
“As an example of the cost of fund pressures ME is experiencing, the cost of funds from ‘term securitisation’ and ‘warehousing’ have increased from BBSW +0.90% to BBSW +1.40% in the last six months while competition in retail deposit markets has seen funding costs increase by in excess of 30 basis points over the same period.”
“ME’s standard variable rate home loan has been lower than the major banks since we became a bank in 2001.”
ME also announced reductions to its 3-year fixed home loan interest rates for both owner occupier and investor borrowers from 4.29% p.a. to 4.04% p.a. (comparison rate 4.82% p.a.) and 4.39% p.a. to 4.09% p.a. (comparison rate 5.20% p.a.) respectively. These fixed rate changes are effective Tuesday 10 May 2016.
Table 1 - ME’s standard variable home loan rate compared
| |
Pre-rate cut rate* |
Variation from ME’s pre-rate cut rate |
Post-rate cut rate* |
Variation from ME’s post-rate cut rate |
| ME |
5.08% |
- |
5.03% |
- |
| ANZ |
5.56% |
0.48% |
5.37% |
0.34% |
| CBA |
5.60% |
0.52% |
5.35% |
0.32% |
| NAB |
5.60% |
0.52% |
5.35% |
0.32% |
| Westpac |
5.68% |
0.60% |
5.43% |
0.40% |
| Bendigo |
5.68% |
0.60% |
5.48% |
0.45% |
| Suncorp |
5.70% |
0.62% |
5.50% |
0.47% |
| BOQ |
5.86% |
0.78% |
5.61% |
0.58% |
| |
|
0.59% (average) |
|
0.41% (average) |
*Standard variable owner occupied home loans
Table 2 – ME’s standard variable owner occupied home loan rates effective 16 May 2016
| Product |
New variable
rate % p.a. |
Comparison
rate % p.a. |
| Basic home loan (reference rate) |
4.44 |
4.46 |
| Flexible home loan (reference rate) |
5.03 |
5.05 |
| Flexible home loan – Member Package (ref rate) |
4.83 |
5.22 |
| Standard Home Loan |
5.03 |
5.05 |
| Ultimate Offset Account |
5.33 |
5.35 |
| Interest Only Investment Loan |
5.03 |
5.05 |
| Standard Home Loan - Settled before 01-Oct-98 |
5.03 |
5.05 |
| Member Package – Standard Home Loan |
4.83 |
5.22 |
| Member Package - Ultimate Offset Account |
4.83 |
5.23 |
| Member Package - Interest Only Investment Loan |
4.83 |
5.22 |
Table 3 – ME’s standard variable investor home loan rates effective 16 May 2016
| Product |
New variable
rate % p.a. |
Comparison
rate % p.a. |
| Basic home loan (reference rate) |
4.44 |
4.46 |
| Flexible home loan (reference rate) |
5.03 |
5.05 |
| Flexible home loan – Member Package (ref rate) |
4.83 |
5.22 |
| Standard Home Loan |
5.44 |
5.46 |
| Ultimate Offset Account |
5.74 |
5.76 |
| Interest Only Investment Loan |
5.44 |
5.46 |
| Standard Home Loan - Settled before 01-Oct-98 |
5.44 |
5.46 |
| Member Package – Standard Home Loan |
5.24 |
5.62 |
| Member Package - Ultimate Offset Account |
5.24 |
5.63 |
| Member Package - Interest Only Investment Loan |
5.24 |
5.62 |
Table 4 – ME’ new 3-year fixed home loan rates effective Tuesday 10 May 2016
| 3 year fixed |
Current rate |
New rate |
Comparison rate |
| Owner occupier |
4.29% p.a. |
4.04% p.a. |
4.82% p.a. |
| Investor |
4.39% p.a. |
4.09% p.a. |
5.20% p.a. |
- ends-
Interest rates are proposed as at 16/5/2015 and subject to change. Terms and conditions are available on request. Fees and charges may apply. Applications are subject to credit approval. Australian Credit Licence 229500. #Comparison rates calculated on a loan of $150,000 for a term of 25 years, repaid monthly. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.