At its fortnightly pricing committee meeting, Bendigo Bank decided to increase its residential mortgage variable interest rate by 0.10% p.a. to 5.48% p.a. for owner occupied and 5.76% p.a. for investor loans.
Bendigo and Adelaide Bank Managing Director Mike Hirst said the adjustment reflects that recent ultra-competitive mortgage pricing is unsustainable.
“The cost of funding these loans through both retail deposits and wholesale term debt is rising. Global financial markets have been volatile and this is impacting the cost of raising funds domestically as competition for stable deposits increases,” Mr Hirst said.
“Even after this change, the vast majority of our borrowers pay well below the standard residential mortgage variable interest rate, and at rates which are a far cry from the 7.8% percent interest rates seen in November 2010.
“When setting these rates we’ve tried to carefully balance the interests of these mortgage customers, those who earn money through deposits and those who invest in our Bank,” he said.
Customers on a residential owner occupied variable interest rate with a $250,000 loan will see their repayments increase by $15.63 a month (principal and interest home loan over 30 years).
The adjustment is effective 15 December 2016 for new and existing loans.
