The Chinese bank ICBC is the latest to sharpen its home loan rate with 3.18% for one year, 18 months and two years fixed. This cut follows Bank of China's drop of their one-year term and two-year term to 3.15%.
The 4 Chinese banks HSBC, Bank of China, China Construction Bank and ICBC are now the leaders in the New Zealand market. Their one-year and two-year fixed rates range from 3.15% - 3.35%, which is 0.14% lower than the so-called top 5 banks.
The way these banks operate and how they are allowed to manage their funding does allow them to offer these lower mortgage rates. With the OCR being expected to drop again in November, will the bigger banks be forced to cut their rates further to keep up with the Joneses?