Last week Bank Direct increased most of its rates including its key two-year rate. Its two-year rate is up 10 basis points to 7.60%, - the same as Bank of New Zealand.
That leaves Kiwibank with the lowest, standard, carded two-year rate. Its rate is 7.50%.
However BNZ also increased rates, but not in the one and two year area.
Its six month rate is up to 7.80% and its four and five year rates have gone up a full 20 basis points to 8.00%.
A key feature of last week’s rate changes (besides there not being many) was that most of the lenders to move were banks. Besides Bank Direct, BNZ put up rates, as did HSBC.
HSBC has taken a different approach to fighting over the lowest two-year rate.
Last week it launched its "Home Loan Plus" package which is designed to compete against Westpac and ANZ for customers in the upper end of the market: "High income customers with borrowings of more than $300,000 in Auckland/Wellington regions and $250,000 in all other regions and especially those with loans over $500,000."
HSBC is offering discounts of up to 50 basis points on floating rates and 20 basis points on fixed rates for these customers along with a number of other sweeteners.
The main non-bank lender to change its rates last week was PSIS. However Equitable put up its floating and two-year rates, while Headstart, which is part of Avon Investments that listed on the NZAX last week, put up its floating rate to 9.25%.
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