Kiwibank reduces one-year fixed-term home-loan rate despite no change to OCR

Despite no change to the official cash rate this week Kiwibank is reducing its one-year fixed-term home-loan interest rate from 3.55% to 3.39%, a new record low. The New Zealand owned bank has good news for savers too, increasing its one-year term-deposit rate from 2.70% to 2.75%.

“Implications from the ‘no rate change’ decision were that wholesale rates increased. It’s likely we’ll be the outlier reducing our one-year home-loan rate but that is a position we’re comfortable to hold,” said Chris Greig, Kiwibank General Manager for Borrowing and Savings.

“We’re keen to see a continuation in the momentum we’ve had in growth over the past year as more New Zealanders choose to bring their banking to Kiwibank.

The wholly-owned New Zealand bank is also currently offering a sweetener in the form of a $3,000 cash back for those that have at least $250,000 in new lending and wish to make the switch to Kiwibank.

There is a minimum 20% equity for the one-year lending rate and cash back offer. The new rates are effective from Monday 18 November and will available for a limited time.

Kiwibank’s variable home loan rate remains the same at 5.15% and its two-year fixed rate is increasing from 3.45% to 3.55%.

“We’ll continue to review our rates to ensure that we are competitive, and both our deposit and lending customers are getting a fair deal,” Greig said.