ANZ cuts mortgage rates in shock move

EXCLUSIVE: One of the nation’s biggest banks has dropped variable rate loans in a shock move - but there’s a catch, of course.

ONE of the nation’s biggest banks has dropped variable rate loans in a shock move.

ANZ has today revealed it has today dropped its owner occupier principal and interest rates on its “no frills” loan.

The move sees the bank slashing its basic variable rate from 34 basis points to 3.65 per cent.

This will save customers on a $300,000 30-year loan $52 per month.

The rate cut only applies to new customers and not existing ANZ borrowers.

It is now the lowest basic variable rate among the Big Four banks.

The move comes at a time when banks are being squeezed as funding costs soar and many suspect banks will push rates up not down.

The banks have been under intense pressure in recent months after the financial services Royal Commission revealed they were ripping off customers.

This included misconduct such as fee gouging and misleading customers.

Financial comparison website RateCity’s spokeswoman Sally Tindall said the surprise move indicates the banks are under immense pressure.

“It signals the banks are worried about market share and this is their attempt to attract new customers,’’ she said.

“It’s interesting to see them cutting when everyone expects them to hike.”

The Simplicity Plus loan has no offset account attached and is the bank’s most basic mortgage product.

In recent weeks fixed rates deals have been falling, while on the flip side banks have been pushing up variable rate loans.

The Reserve Bank of Australia board has kept the cash rate on hold since August 2016.

The board meets again on Tuesday and it’s expected they will keep the cash rate on hold.

It’s not expected the cash rate will move until at least next year or even 2020.

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