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More banks have increased interest rates as the pressure of increased funding costs continues to mount.
Both Bendigo Bank and Teachers Mutual Bank Limited (TMBL) announced new rates yesterday. TMBL includes three banks: Teachers Mutual Bank, UniBank and Firefighters Mutual Bank.
While Bendigo has increased its variable interest rates for home owners, TMBL announced changes to its fixed rates for new customers to the group’s brands.
Bendigo has confirmed the changes are to absorb increasing funding costs.
Managing Director Marnie Baker said the changes reflect the increased cost of funding.
She said, "When setting interest rates our bank needs to consider many factors and carefully take into account the needs of our stakeholders including customers, shareholders, staff, partners and the broader community.
"Funding costs have been steadily increasing this year, and we’ve absorbed this cost impact to date. Today’s adjustment to the variable interest rates will assist in balancing this funding cost increase.
"We carefully balance the interests of our mortgage customers, those who earn money through deposits and those who invest in our Bank. We must ensure our pricing remains market competitive, provides the appropriate platform for sustainable growth and supports the hundreds of communities in which we operate."
TMBL rates have increased on selected fixed rate home loan products.
The rates have been increased by 8, 9, and 9 basis points for 1, 2, and 3 year fixed rates respectively.
TMBL chief executive officer, Steve James, said, “These rate changes are the first increase in 12 months for fixed rates, and follow a decrease to our fixed rates last November.
“Any new members who join after these rate changes will still have access to a competitive market rate and great products, such as our 100% mortgage offset facility.”
Other banks to increase rates recently include AusWide, IMB, AMP, ING and Bank of Queensland.
Rate changes – Bendigo
Variable interest rates across home loans and lines of credit will increase for owner occupiers and investors as follows:
- Owner occupier principal and interest loans will increase by 0.10% pa;
- Owner occupier interest only loans will increase by 0.16% pa;
- Investment loans will increase by 0.10% pa;
- Lines of credit will increase by 0.10% pa.
The interest rate changes announced are effective Monday 23 July.
Customers on a residential variable interest rate with a $250,000 loan will see their repayments increase by $15.71 a month (principal and interest home loan over 30 years).
Rate changes – TMBL
The changes will affect owner-occupier, principal & interest, 1, 2 and 3 year fixed rate home loans.
The new rates are as follows:
- 1 Year Fixed rate OO P&I – 3.87% p.a.
- 2 Year Fixed rate OO P&I – 3.78% p.a.
- 3 Year Fixed rate OO P&I – 3.88% p.a.
The new rates are effective from Monday, 16July 2018.
