A raft of changes in home loan rates in the past fortnight have changed the shape of the competitive market and the yield curve.
Saturday, May 24th 2008, 5:14PM
Good Returns has started compiling some series of graphs showing how the various groups are positioned against each other.
The three groups we have are:
Big banks: ANZ, ASB, BNZ, National and Westpac
Second tier banks: Kiwibank, Bank Direct, Kiwbank and HSBC
Non-bank lenders: Cairns Lockie, Sovereign, Pioneer, Wizard and PSIS.
The graph below shows the median rates for each of these groups over standard terms.
The key points are that big bank floating rates are significantly higher than the other two groups, while non-bank lenders struggle to compete at the long end of the curve with five year rates.
Recent economic news and competitive activity have "bent" the yield curve and put one and two year rates below longer term rates. Also it shows that the big banks have become very competitive in this space having the lowest median one year rates, while it sits between the other two groups for all the other fixed rate terms.
