Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Small Increase In Variable Mortgage Rate

Media Statement from Bank of New Zealand

8 December 2003

Small Increase In Variable Mortgage Rate

The Bank of New Zealand today announced a small increase in its variable rate for residential mortgages. The increase will affect about one third of Bank of New Zealand mortgage customers. The remainder of the bank's residential customers - about 70% of customers - have fixed-rate mortgages and they will be unaffected by the increase.

The variable rate for mortgages with Bank of New Zealand will increase from 7.10% to 7.25% (increase of 0.15%). One other major lender, Westpac, raised its variable rate to 7.25% in November.

The increase in variable rates will add $2.93 to fortnightly repayments of an average-sized variable rate mortgage ($66,000 over 25 years) with Bank of New Zealand.

The change is effective from Tuesday, 9 December, for new customers, and from Tuesday, 23 December, for existing customers. Existing customers will be advised in writing of the change and the impact it will have on their repayments.

At the same time as it adjusts variable mortgage rates, Bank of New Zealand is increasing the rates it pays deposit holders with term deposits. Term deposit rates will increase by between 0.05% and 0.3%, effective immediately, for new term deposits of 90 days or more.

Bank of New Zealand spokesperson Owen Gill said: "People with term deposits with Bank of New Zealand will get the benefit of higher interest rates immediately."

Mr Gill said the increase in variable mortgage rates reflected increasing 90-day bill rates.

"Residential mortgages in New Zealand are funded from the 90-day money market, and interest rates in those markets have been increasing slowly but steadily since midway through the year. Ninety day bill rates have risen 21 basis points since late July.

"Ninety day rates are rising because those markets recognise that interest rates in New Zealand generally are rising as inflationary pressures in the domestic economy grow. In other words, the cost of borrowing is increasing across the New Zealand economy and increases in variable mortgage rates reflect that."

Bank of New Zealand's fixed rates for mortgages, which are 6.90% for one year, and ranging up to 7.75% for five years, remain unchanged. Bank of New Zealand continues its special offer of mortgages with a 3.99 % fixed rate for the first three months on a three-year 7.6% fixed rate home loan.

Ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Government: Delivering Lower Card Fees To Business

Commerce and Consumer Affairs Minister David Clark has today announced the Government’s next steps to reduce merchant service fees, that banks charge businesses when customers use a credit or debit card to pay, which is estimated to save New Zealand businesses ... More>>

SEEK NZ Employment Report: April 2021

OVERVIEW OF APRIL 2021: STATE OF THE NATION: April, for the second consecutive month, saw the highest number of jobs ever advertised on seek.co.nz. Applications per job ad fell 9% month-on-month (m/m). SEEK job ads were up by 12% m/m. SEEK job ads were ... More>>

Commerce Commission: Warns Genesis Over Business Billing Errors

The Commerce Commission has issued a warning to Genesis Energy Limited about billing errors concerning electricity line charges to business customers. Genesis reported the errors to the Commission. The Commission considers that Genesis is likely to ... More>>

Stats: Lower Job Security Linked To Lower Life Satisfaction

People who feel their employment is insecure are more likely than other employed people to rate their overall life satisfaction poorly, Stats NZ said today. New survey data from the March 2021 quarter shows that 26 percent of employed people who thought ... More>>

The Conversation: The Outlook For Coral Reefs Remains Grim Unless We Cut Emissions Fast — New Research

A study of 183 coral reefs worldwide quantified the impacts of ocean warming and acidification on reef growth rates. Even under the lowest emissions scenarios, the future of reefs is not bright. More>>

The Conversation: Why Now Would Be A Good Time For The Reserve Bank Of New Zealand To Publish Stress Test Results For Individual Banks

Set against the backdrop of an economy healing from 2020’s annus horribilis , this week’s Financial Stability Report (FSR) from the Reserve Bank (RBNZ) was cautiously reassuring: the country’s financial system is sound, though vulnerabilities remain. More>>