Following the Reserve Bank of Australia’s decision to increase the official cash rate by 0.25% to 3.10% on Tuesday at 2.30pm, Westpac announced the same afternoon that it would increase its home loan variable interest rate by 25 basis points.
For Westpac home loan customers, the bank’s home loan variable interest rates will increase by 0.25% for new and existing customers, effective December 20.
For Westpac deposit customers, Westpac Life total variable rate with bonus interest will increase by 0.25% to 3.75% and under Westpac’s Spend&Save offer for 18 to 29-year-olds, eligible customers can earn a total variable rate of 4.35%, an increase of 0.35%, both effective December 16.
Westpac’s decision means it’s the first of the big four banks to increase its interest rates after the RBA hiked the official cash rate for the eighth consecutive month to a 10-year high.
“We know our customers are paying extra attention to their household budget in the lead-up to Christmas and looking at ways to manage their money into the New Year in the changing economic environment,” said Westpac consumer and business banking chief executive Chris de Bruin (pictured above).
“We’re continuing to increase savings interest rates to support customers saving for the future. While the majority of our customers are managing well through this cycle with a strong jobs market and savings built up during the pandemic, we understand some customers may find it more difficult. We have an experienced customer support team ready to work with each customer one-on-one to offer help if they are in a tough spot.”
Westpac says when reviewing interest rates, the bank balances the needs of both borrowers and depositors, as well as considering other factors such as the cash rate, returns and market environment.
Less than an hour after Westpac lifted its variable home loan rates, Suncorp Bank also announced it would increase its home loan variable rates by 0.25%, beginning December 15.
