“Un-Australian”: Reaction to rate hikes

Two major lenders have increased their variable home loan interest rates, more than a week after Westpac became the first of the big four to do so.

ANZ made the announcement first, hiking its raise by 16 basis points. Commonwealth Bank (CBA) was just moments after, hiking by 15 basis points.

While the industry waits for NAB to make the next move, it has begun commenting on the behaviour of the other three so far.

RateCity research director Sally Tindall said the hikes show that when one big banks pulls the trigger, their counterparts aren’t far behind.

She said, “CBA and ANZ’s decision to hike rates hot on the heels of Westpac was a predicable step in what is becoming a well-worn routine.

“In fact, hiking on the same day means they can shoulder the backlash together.

“What this rate hike means is that the vast majority of variable rate home owners will now be shelling out more on their mortgage each month.

“NAB would do well to break free of tradition and find a different way to wear the additional expense.”

The COO of mortgage marketplace HashChing, Siobhan Hayden, said ANZ’s move was “shocking” when it had only just decreased rates a few weeks ago.

She added, “It’s surprising that three of the major banks have increased interest rates in unison, despite being hauled over the coals in the recent banking Royal Commission.

“During a period of clear upward pressure on wholesale funding costs, ANZ announced a 0.34 basis point reduction in owner occupied lending for new customers only.

“Now, just over a month later, it has announced a 0.16 basis point increase to both residential and investor lending from 27th September 2018.

“This seems like a classic bait and switch. Customers encouraged by ANZ’s rate reduction announcement on the 1st of August would rightfully now feel betrayed and manipulated by a ‘honeymoon rate’ seduction.

“Commonwealth Bank recently reported a full-year net profit of $9.38b. Meanwhile, everyday Australians are now at risk of losing their homes because they can't afford the higher repayments and can't get bank approval to refinance their home loans. It's an absolute shambles, and someone needs to take responsibility.

“The anti-competitive behaviour of the big four is certainly something Scott Morrison should look into. It’s un-Australian.”