MORTGAGE LOANS – AUSTRALIA

Big four in great rate cuts rip-off

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Original article by Adam Creighton, David Tanner
The Australian – Page: 1 & 6 : 10-Jul-19

The gap between the cash rate and the average variable mortgage interest rate of Australia’s major banks was consistently around 1.8 percentage points between 1997 and 2007. However, this gap has widened significantly since then, and the two consecutive official interest rate cuts has increased it to a 25-year high of 3.94 percentage points. The banks contend that factors such as rising funding costs, capital requirements and increased regulation mean it has become more difficult to move in tandem with the Reserve Bank.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. PRODUCTIVITY COMMISSION, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION

Time is money as CBA waits on cuts

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Original article by Cliona O’Dowd
The Australian – Page: 21 & 24 : 5-Jul-19

The Commonwealth Bank’s decision to delay a 19 basis point reduction in its variable home loan interest rates until 23 July will boost its interest income by $43m. The other three major banks will also gain additional interest income from mortgage customers by delaying rate cuts by periods ranging from nine days to two weeks. It is estimated that the big four banks’ move to delay passing on the official interest rate cut in full or in part will boost their interest income by a combined $97m.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, SHAW AND PARTNERS LIMITED, MOZO PTY LTD, HSBC AUSTRALIA HOLDINGS PTY LTD, FIRSTMAC LIMITED, ME BANK

Lenders reluctant to pass on cut in full

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Original article by Joyce Moullakis
The Australian – Page: 19 : 4-Jul-19

Macquarie Bank, Suncorp, ME Bank and ING will reduce their interest rates on a range of mortgage products by less than the latest 25 basis point reduction in the cash rate. They have joined Westpac, National Australia Bank and the Commonwealth Bank in not passing on the Reserve Bank’s interest rate cut in full. However, a number of smaller lenders have reduced their mortgage rates by the full amount, including Athena, Resimac and Newcastle Permanent.

CORPORATES
MACQUARIE BANK LIMITED – ASX MBL, SUNCORP BANK, SUNCORP GROUP LIMITED – ASX SUN, ME BANK, ING BANK (AUSTRALIA) LIMITED, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, ATHENA HOME LOANS PTY LTD, RESIMAC GROUP LIMITED – ASX RMC, NEWCASTLE PERMANENT BUILDING SOCIETY LIMITED, STATE CUSTODIANS PTY LTD, RACQ BANK, HOMESTAR FINANCE PTY LTD, REDUCE HOME LOANS, RATECITY PTY LTD, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA, MORGAN STANLEY AUSTRALIA LIMITED, SHAW AND PARTNERS LIMITED

Big four rate game plan takes shape

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Original article by James Frost
The Australian Financial Review – Page: 9 : 3-Jul-19

The ANZ Bank’s s variable mortgage interest rates for all customers will be reduced by 25 basis points, in line with the Reserve Bank’s official interest rate cut. The Commonwealth Bank in turn will reduce its rates for interest-only customers by 25 basis points, although those with principal and interest loans will receive a rate cut of just 19 basis points. Meanwhile, Westpac will reduce its mortgage interest rates by 20 basis points, and the ANZ Bank’s will be cut by 19 basis points.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, RESERVE BANK OF AUSTRALIA, ATHENA HOME LOANS PTY LTD, AUSTRALIA. DEPT OF THE TREASURY

Banks suffer as battle for home loans heats up

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Original article by Samantha Bailey
The Australian – Page: 21 : 20-Jun-19

Data from the Australian Prudential Regulation Authority shows that home loan approvals fell by 16.5 per cent year-on-year in the March quarter. The figures also show that the value of mortgage loans written by Australia’s major banks increased by just 2.6 per cent over the last year, compared with growth of eight per cent for customer-owned banks. The total assets of the latter increased by 1.6 per cent quarter-on-quarter, while the assets of the ‘big four’ banks declined by 0.4 per cent.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, CUSTOMER OWNED BANKING ASSOCIATION

Banks not passing on cut nothing new: Treasury

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Original article by Matthew Cranston, James Eyers
The Australian Financial Review – Page: 4 : 7-Jun-19

Westpac and ANZ have been criticised for withholding part of the Reserve Bank’s official interest rate cut. The central bank has cut the cash rate a total of 19 times since 2008, and analysis by the Treasury shows that there have been 13 occasions when at least one of the four major banks failed to pass on the full rate. The banks have also reduced their rates by a higher margin than the official interest rate cut on several occasions since the global financial crisis.

CORPORATES
RESERVE BANK OF AUSTRALIA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. DEPT OF THE TREASURY

Banks defy the Treasurer, RBA

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Original article by Matthew Cranston
The Australian Financial Review – Page: 1 & 4 : 5-Jun-19

Federal Treasurer Josh Frydenberg has criticised the ANZ Bank for reducing its variable mortgage interest rates by just 0.18, after the Reserve Bank of Australia cut the cash rate by 0.25 per cent to a record low of 1.25 per cent. Westpac has cut its variable rates by 0.20 per cent, while National Australia Bank and the Commonwealth Bank have passed the central bank’s full rate cut on to customers. RBA governor Philip Lowe also says the major banks should reduce their mortgage rates by the full amount, given that their wholesale funding costs have fallen significantly.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, WESTPAC BANKING CORPORATION – ASX WBC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, RESERVE BANK OF AUSTRALIA, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIAN LABOR PARTY, JP MORGAN AUSTRALIA LIMITED

New squeeze on big banks

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Original article by James Frost
The Australian Financial Review – Page: 1 & 20 : 31-May-19

The Australian Prudential Regulation Authority is expected to soon announce that smaller banks will have to hold less capital in terms of supporting their mortgage lending. This will enable them to offer cheaper home loans and higher deposit rates, making them more competitive with the larger banks. APRA’s announcement will follow shortly after the Reserve Bank’s June meeting, when it is widely expected to reduce official interest rates to 1.25 per cent.

CORPORATES
AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, RESERVE BANK OF AUSTRALIA, BENDIGO AND ADELAIDE BANK LIMITED – ASX BEN, BANK OF QUEENSLAND LIMITED – ASX BOQ, SUNCORP GROUP LIMITED – ASX SUN, CITIGROUP PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE

ScoMo effect sends us cruising

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Original article by Joyce Moullakis, Luke Griffiths, Lisa Allen, Samantha Bailey
The Australian – Page: 1 & 4 : 29-May-19

Anecdotal evidence suggests that the Coalition’s surprise federal election win has boosted activity in several sectors of the economy. Banks and mortgage brokers say there has been a sharp increase in home loan enquiries in the wake of the 18 May poll, with Commonwealth Bank CEO Matt Comyn noting that it received more mortgage loan applications in the week after the election than it had in more than six months. Cruise lines have also reported an increase in enquiries and bookings, particularly among retirees who would have been hard hit by Labor’s reforms.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSSIE HOME LOANS LIMITED, AUSTRALIAN FINANCE GROUP LIMITED – ASX AFG, NORWEGIAN CRUISE LINE, REGENT SEVEN SEAS, OCEANIA CRUISE LINES PTY LTD, ACCOR ASIA PACIFIC, COUNCIL OF SMALL BUSINESS ORGANISATIONS OF AUSTRALIA LIMITED, AUSTRALIAN LABOR PARTY, ACTU, MASTER BUILDERS AUSTRALIA INCORPORATED

Coalition rejects interest rate risk on loan plan

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Original article by Matthew Cranston
The Australian Financial Review – Page: 9 : 15-May-19

Finance Minister Mathias Cormann has downplayed concerns that the Coalition’s First Home Loan Deposit Scheme could prompt banks to impose higher interest rates on participants in the scheme. He is confident that banks will want to be involved in the scheme and will not charge higher interest rates, arguing that banks’ exposure will still be restricted to a maximum loan to value ratio of 80 per cent. The New Zealand government introduced a similar scheme in 2003.

CORPORATES
AUSTRALIA. DEPT OF FINANCE, WESTPAC BANKING CORPORATION – ASX WBC, KEYSTART HOME LOANS, NEW ZEALAND. MINISTRY OF HOUSING, HOUSING NEW ZEALAND CORPORATION