A major bank which has so far avoided raising rates has announced it will increase its special base variable rate.
NAB's Base Variable Rate Special Offer is available for new owner occupier principal and interest customers. Earlier this year it offered those customers a discount of 3.69%, which it will now increase to 3.87%.
The "limited time" discount offers customers 0.30% off the full rate, which is down from the previous discount of 0.48%.
The new rate for the bank's basic home loan product comes into effect this Friday (9 November) and it will not effect existing customers.
According to figures from RateCity, CBA will now have the lowest ongoing variable rate out of the big four banks.
RateCity.com.au research director Sally Tindall said it was rare to see a bank granting existing customers immunity. She said, “Over the last six months NAB has been a champion of competitive pricing, forcing other lenders to put low rates on the table. This decision sees them pull up stumps in the low-rate market.
"That said, by not changing the rate for existing customers, NAB is staying true to its commitment to build trust.
“It is rare to see a bank hike an interest rate but grant immunity to their existing customers. NAB is clearly focused on backing its own customers, over potential new ones."
HSBC and CBA both cut their owner occupier principal and interest rates recently with HSBC now offering 3.59%, and CBA now offering 3.79% for new customers with 70% equity in their home.
A NAB spokesperson said, "NAB is continuing to keep its Standard Variable Rate (5.24% p.a.) on hold at this time which was announced in September.
"As stated by NAB CEO Andrew Thorburn at our Full Year Results last Thursday (1 November) our decision to leave our SVR on hold is about focusing on our existing customers and appreciating our loyalty."
