Less than a week since ANZ announced their rate cut, Westpac, and now BNZ, has followed suit.
BNZ announced this morning that they would be matching the one-year and two-year term of ANZ and Westpac at 3.55% and 3.45% respectively. But also going one step further to put themselves the lowest amongst the Australian banks, they've also announced that they will be matching Kiwibank's three, four and five-year rate of 3.99%.
It seems that spring is finally here. We've already seen an increase in sales volume, especially in Auckland, and now it looks like the mortgage market is catching on.
ASB bank is the only Australian bank left that haven't adjusted any of their rates this week, but it probably won't be long until they do. ASB has made it clear since August, after the 0.5% OCR cut, that they don't see interest rates going any lower. This is despite further potential cuts to the OCR as it will be a struggle to balance the deposit and mortgage interest rates. So, it wouldn't be a surprise at all if they take a backseat role on this rate war and continue to be the very last bank to come to the party and simply match what the others are doing.
With the OCR expected to reduce again in November, we see that there's still room for bank margins to be cut further, especially if sales volumes continue to increase through the summer.