December 2016 published 20/12/16 In Home Loans variable rates were pushed higher, with most making changes targeted towards investor loans, but some also increasing rates for owner occupiers. There was also xed rate increase momentum, especially at longer terms. In Cards, there were some new product launches, and rate increases on low rate products. Two major banks increased unsecured Personal Loans while others cut them, and some sharp new rates for car loans. Very few changes to Savings Account rates, but one online challenger brand increased its ongoing bonus rate. A more even split between cuts and increases for Term Deposit rates this month, but top rates are still drifting down. We will catch up with the rest of December in our January edition. All the best for the festive season! 1
Home Loans A range of providers increased variable rates during the month, and more have announced changes that aren t yet implemented. Most have been focused on investor loans, however a few have applied increases to both investors and owner occupiers. 1 year xed rates had an even split between increases and decreases, however for all other terms there were many increases and negligible cuts. Key changes - variable rates ANZ added 8bp to its variable investor rates, taking the total premium charged to 35bp on the bank s Breakfree Package. Bankwest increased variable rates for investors by 15bp, with the total premium now varying between 42bp and 62bp, depending on the loan. Bendigo Bank increased variable rates for all borrowers by 10bp. Commonwealth Bank added 7bp to its investor premium on variable rate loans, now a total of 34bp. ING Direct increased all variable rates by 15bp. NAB added 15bp to its variable rates for investors taking the premium for principal and interest loans to 30bp and for interest only loans to 40bp. 2
Suncorp increased its investor premium by 15bp, now 47bp on its Standard Variable rate loan, while its Back to Basics Special is up 31bp, now 4.02% for owner occupiers and 4.29% for investors. UBank increased all variable rates by 10bp. Westpac and its St.George group of brands introduced a premium of 8bp on interest only variable rate loans. Key changes - xed rates Commonwealth Bank increased some xed rates, with 3 years up 20bp to 4.09% and 5 years up 60bp to 4.59%, while the 4 year rate is down 20bp to 4.39%. Newcastle Permanent increased xed rates for all terms, but of particular note are the 4 and 5 year rates, both up 100bp to 4.80%. The 5 year was best for the term last month but the best for 5 years now is 3.99%. QT Mutual Bank had the equal best 1 year and the best 2 year xed rates last month at 3.59%, but increased both of those 10bp. 3
Chart of the month Fixed rate home loans Shifting concentration of xed rates Best xed rates per lender at 31 October and 20 December for $300,000 owner occupier loan with 80% LVR The chart shows how, at all terms, the concentration of rates has retreated up the page since October. The shift has been most pronounced where the Major banks have made the biggest shift and nowhere more so than at 5 years. 4
Home Loans Market snapshot Major banks Basic Variable, Owner Occupier ANZ Simplicity PLUS 4.03% Commbank Extra Home Loan 4.19% ($8 monthly) NAB Base Variable Rate Home Loan 4.10% Westpac Flexi First Option Home Loan 3.99% for 36 months (variable) then 4.49% Major banks Best package rates, Owner Occupier ANZ Over $500,000 (<80% LVR) 4.35% Commbank Over $750,000 4.52% NAB Over $750,000 4.35% Westpac Over $750,000 4.39% Major banks Best xed rates, Owner Occupier 1 year 2 years 3 years 4 years 5 years ANZ 4.39% 3.75% 3.85% 4.59% 4.59% Commbank 4.39% 3.84% 3.89% 4.59% 3.99% NAB 3.99% 3.75% 3.89% 3.99% 4.59% Westpac 4.39% 3.99% 4.09% 4.59% 4.39% 5
Rate leader Best variable, Owner, 80% LVR Rate Reduce Home Loans Rate Buster 3.35% Term Best rate Providers 1 year 3.59% Greater Bank 2 years 3.64% Homestar 3 years 3.49% My Credit Union 4 years 3.75% BCU 5 years 3.99% Bank Australia, Greater Bank 6
Credit Cards This month saw rate increases on a few low rate cards, another online only o er from a major bank, new products and two new low rate cards launched. Key changes After cutting rates on its Breeze cards to 8.99% in August, this month Bankwest returned the rate on both cards to 12.99%. The balance transfer o er on both was changed from 2.99% for 9 months to 0% for 21 months, and the cards no longer have annual fees waived for the rst year. Citibank removed the 0% for 9 months balance transfer and introductory purchase rate on its Clear Platinum card. Coles increased the rate on its Low Rate MasterCard from 9.99% to 12.99%. CUA removed the 25,000 bonus points o er on its Platinum Credit Card. Easy Street launched its rst credit card products called the Easy Low Rate Visa Credit Card. The card has a rate of 8.99% and annual fee of $40. NAB launched a Low Rate version of its Platinum card. The rate is the same 13.99% as the standard card, but the annual fee is $100 instead of $59, and has extras such as concierge and a variety of insurances. The bank also introduced an online only o er on its Premium Card with a 0% for 24 months balance transfer rate, attracting a one-o 3% fee. 7
Credit cards Market snapshot Majors ANZ Commbank NAB Westpac Summary of card o ers 0% for 18 months BT (+3% fee) on First and Platinum 0% for 6 months purchase rate on Low Rate/Low Rate Platinum and $100/$250 cashback $0 rst year annual fee on Platinum & Frequent Flyer range between 25,000 and 75,000 bonus rewards points 5.99% for 5 months BT on all cards $0 rst year annual fee on all non-rewards cards $250 cashback on Low Rate/Low Rate Gold cards 0% for 15 months BT (+3% fee) on all cards 0% for 15 months intro rate on all cards except online o ers 0% for 24 months balance transfer (but no introductory purchase rate) online only o er on the Premium Card 15,000 or 25,000 bonus rewards points on Qantas/Velocity cards 75,000 bonus points (but no introductory purchase rate) on Qantas Premium for online applications 0% for 16 months BT on all cards 1% purchase rate for 12 months on all cards $0 rst year annual fee on 55 Day and 55 Day Platinum 50,000 bonus points on Altitude Platinum and Black 100,000 bonus points on Altitude Black for online applications Top o ers 0% BT Citibank NAB 0% purchase NAB Coles Platinum Premium Card (online only) All cards No Annual Fee MasterCard 24 months 15 months Lowest purchase Police Credit Union SoLo Credit Card 6.99% Bonus points American Express American Express Westpac Explorer Credit Card Qantas Ultimate Card Altitude Black (online only) 100,000 8
Personal loans Two major banks increased unsecured personal loan rates while others were cutting them. Some of the largest rate reductions were made to car loans. Key changes ANZ dropped the rate on its Online Car Loan from 6.80% to 6.15%. Bank of Queensland cut the rate on its Unsecured Personal Loan from 13.90% to 12.39%. Commonwealth Bank increased its Unsecured Personal Loan rate from 12.40% to 13.90%. CUA cut its Unsecured Personal Loan rate from 12.99% to 11.89%. Gateway Credit Union dropped its New Car Loan rate from 7.04% to 5.69%. IMB Bank took its Car Loan rate down 35bp to 5.99%. The annual fee on all personal loans was increased by $51 to $250. NAB increased its Personal Loan rates with the variable rate going from 13.69% to 14.69%, and the xed going from 14.19% to 14.99%. 9
Personal loans Market snapshot Major banks Secured Unsecured ANZ 6.15% 13.95% Commbank 8.49% 13.90% NAB n/a 14.69% Westpac 8.49% 12.99% Rate leaders loans.com.au New Car Loan 4.94% Secured G&C Mutual Bank Fair Rate Personal Loan 5.99% Unsecured 10
At-call deposits Very few changes to at call deposit rates, and of those only one rate was increased. Key changes ING Direct increased the ongoing bonus rate on its Savings Maximiser from 2.75% to 3.00%. P&N Bank reduced the ongoing bonus rate on its SwiftSaver Account by 20bp to 2.00%. RaboDirect cut the 4 month introductory rate on its High Interest Savings Account from 3.20% to 3.05%, but it remains the top short term bonus rate in the market. 11
At-call deposits Market snapshot Major banks Ongoing bonus rate Introductory rate ANZ 1.91% Progress Saver 2.85% for 6 months Commbank 1.85% GoalSaver 2.60% for 3 months NAB 2.70% Reward Saver 1.90% for 4 months Westpac 1.85% Reward Saver 2.71% for 5 months Online Saver NetBank Saver isaver esaver Rate leaders RAMS 3.15% Saver Account Ongoing bonus RaboDirect 3.05% for 4 months High Interest Savings Introductory 12
Term deposits There was a more balanced mix of increases and decreases with far fewer rates reduced than we ve seen in recent months. The top rate for terms of less than 1 year is now 2.90%, down from 2.95% last month and 3.10% at the end of October. Key changes Commonwealth Bank s best rate for less than one year is still its 7 month term, but down 10bp to 2.10%. The bank s 2 year rate is also down, from 2.45% to 2.30%. NAB s best rate for less than one year is still its 8 month term, but down from 2.40% to 2.20%. BankVic and Maitland Mutual Building Society joined the 8 that were o ering 3.20% for 3 years last month. The best rate for 4 years went down from 3.20% last month to 3.10% this month following rate cuts by Big Sky and QT Mutual Bank. See details of top rates on the following page. 13
Term deposits Market snapshot Major banks Up to 1 year 1 year 2 years ANZ 2.20% for 6 months 2.55% 3.20% Commbank 2.10% for 7 months 2.25% 2.30% NAB 2.20% for 8 months 2.40% 3.10% Westpac 2.20% for 6 months 2.50% 3.00% Rate leaders Less than 1 year ME 2.90% (for 11 months) 1 year ING Direct 3.00% 2 years ANZ 3.20% 3 years BankVic Commonwealth Bank Maitland Mutual NAB People s Choice CU Qudos Bank St.George (& BSA/BoM) 4 years Arab Bank Australia G&C Mutual Bank QT Mutual Bank 3.20% 3.10% 5 years RaboDirect 3.30% 14
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