Westpac is lifting its rates for mortgages fixed between six months and two years.
In the move announced on Thursday, Westpac made multiple changes to its interest rate offerings – bumping up short-term rates but also bringing down longer-term loans.
Westpac has added 30 basis points to its six-month standard fixed rate, taking it to 7.49 percent. The one-year fixed rate is slightly lower – up 20bp to 7.39 percent.
The bank’s 18-month (7.29 percent) and two-year (7.19 pct) fixed rates also went up by 10 and 5bp respectively.
But Westpac has slashed its three and four-year rates by 60bp and five-year loans by 50bp, all of which sit at 6.59 percent.
Westpac NZ product, sustainability and marketing general manager Sarah Hearn said last week’s 50bp increase in the official cash rate (OCR) played a part in the changes.
“Our variable lending and on-call savings interest rates are closely tied to movements in the OCR,” she said in a statement.
“That’s why we’re increasing the interest rate on our variable home loans by 40bps and on our on-call consumer savings products by 40bps to 50bps.”
But she noted Westpac didn’t lift home loan rates when the Reserve Bank (RBNZ) last hiked the OCR by 50bp in February.
“While most customers are coping well with the rising cost of living and increase in interest rates, we know these conditions will be causing challenges for some borrowers,” Hearn said.
“We ask anyone who is feeling financial stress to come and talk to us early so we can discuss their options.”
Households on fixed-term loans that were close to expiry were being contacted by Westpac to discuss their options, Hearn said.
ANZ on Wednesday also increased its fixed loans by between 14 and 20bp but did not offer lower rates for longer-term options.
The RBNZ was largely expected to hike the OCR again at its next meeting in May, given last week’s bump was bigger than predicted due to persistently high inflation.
In a report last Wednesday, ANZ said it was expecting a lower 25bp increase to the OCR next month and for the baseline interest rate to peak at 5.5 percent.