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Mortgages

Mortgage Rates Daily Commentary
Monday 25 May 2020  Add your comment
Kiwibank launches record low rate: compare the market

This week kicks off with a record low rate, as Kiwibank's previously announced 2.65% home loan comes into effect this morning. 

ASB's sharp 2.69% two-year loan was launched over the weekend. Expect more movement this week as rivals follow.

With so many changes, keep track of the latest rates and compare the market here.

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Kiwibank lifts profits and mortgage market share

Kiwibank continues to increase profits and gain market share in the mortgage market, although it describes the economic environment as "challenging."

Wednesday, August 27th 2008, 4:19PM

by Jenny Ruth

Net profit for the year ended June rose to $36.8 million from $30.9 million the previous year, although new accounting standards mean the latest year's result was depressed while the previous year's result was inflated (last year's result was $25.5 million under the old rules).

Similarly, a jump in profit for the three months ended June to $6.7 million compared with $0.46 million in the previous fourth quarter reflected the new accounting standards.

Kiwibank's mortgage book grew $252 million to $5.1 billion during the three months ended June and compared with $3.47 billion in June last year. The annual increase included the acquisition of the $700 million AMP mortgage book.

Using Reserve Bank figures as a proxy for the market, its market share rose to 3.35% from 3.23% three months earlier. Past due residential mortgages at June 30 totalled $5.87 million.

Managing director Sam Knowles says Kiwibank is valuing its mortgage book on a fair value basis with changes reported through the profit and loss statement which means reported profits are significantly more volatile than under the previous accounting standards.

"When the mortgage margin goes up, the value of our profit goes down." Because of that volatility, "we're looking to change that fair value treatment over time," Knowles says. "The true underlying profit increase is quite a lot better than the 20% we're reporting."

Kiwibank's retail deposits grew 46% to $4.8 billion and Knowles says such growth allowed the bank to be largely self-funded for its residential and small business loans.

Kiwibank has been progressively classifying its mortgage book under the new Basel ll banking rules and the latest general disclosure statement shows 82.3% of the book had loan-to-value ratios (LVRs) below 80%. Mortgages with LVRs above 90% fell to 9.9% of the book from 17.5% at the end of March. All Kiwibank's loans above 80% LVRs are fully insured by third parties.

Kiwibank had extended to provide more explanation of its LVR figures but Knowles says preparation of the latest GDS was disrupted by the sudden death of the bank's chief financial officer, Craig Stuart, 44, about a month ago.

« TSB's profit up, loan book downAll predictions tracking downward »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 3.55 3.89 3.99
AIA Special - 3.05 3.39 3.69
ANZ 4.44 ▼3.29 ▼3.45 ▼3.85
ANZ Special - ▼2.79 ▼2.95 ▼3.35
ASB Bank 4.45 ▼3.35 ▼3.19 ▼3.85
ASB Bank Special - ▼2.85 ▼2.69 ▼3.35
Bluestone 4.44 4.44 4.29 4.34
BNZ - Classic - ▼2.79 2.99 ▼2.99
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.75 3.99 4.39
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
China Construction Bank 5.50 4.70 4.80 4.95
China Construction Bank Special - 2.80 3.15 3.19
Credit Union Auckland 5.95 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union North 6.45 - - -
Credit Union South 5.65 4.75 4.75 -
Finance Direct - - - -
First Credit Union 5.85 3.99 4.49 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Lender Flt 1yr 2yr 3yr
Heretaunga Building Society 4.99 4.35 4.45 -
HSBC Premier 4.49 ▼2.80 ▼2.89 3.50
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC ▼4.40 ▼2.95 ▼2.95 ▲3.69
Kainga Ora 4.43 3.55 3.85 4.14
Kiwibank 4.40 3.74 4.14 4.40
Kiwibank - Capped - - - -
Kiwibank - Offset 4.40 - - -
Kiwibank Special - ▼2.65 ▼2.79 ▼3.25
Liberty 5.69 - - -
Lender Flt 1yr 2yr 3yr
Napier Building Society - - - -
Nelson Building Society 4.95 3.75 3.99 -
Pepper Essential 5.18 - 4.98 4.98
Resimac 3.49 3.45 3.39 3.69
RESIMAC Special - - - -
SBS Bank 4.54 4.85 5.05 5.49
SBS Bank Special - ▼2.99 ▼3.05 3.69
The Co-operative Bank - Owner Occ 4.40 3.09 3.35 3.69
The Co-operative Bank - Standard 4.40 3.59 3.85 4.19
TSB Bank 5.34 ▼3.59 ▼3.79 ▼4.19
TSB Special 4.54 ▼2.79 ▼2.99 ▼3.39
Lender Flt 1yr 2yr 3yr
Wairarapa Building Society 4.99 3.95 3.99 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - ▼2.79 ▼2.79 3.39
Median 4.55 3.50 3.79 3.69

Last updated: 25 May 2020 5:00am

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