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Kiwibank cuts one year fixed rate

Kiwibank is the second bank to slash fixed rates after the Reserve Bank's OCR cut, dropping its one year to 3.09%.

Thursday, March 19th 2020, 1:15PM

The one year special rate is the second cheapest in the market behind ANZ, which cut its one year special to 3.05% this morning. 

ANZ's rate, effective this morning, is the cheapest ever major bank mortgage rate in New Zealand.

Unlike ANZ, Kiwibank has kept its two year rate on hold. Its two year special offering remains at 3.39%. 

Kiwibank has stopped short of waging a price war against ANZ, but other big four banks are expected to follow the lender and slash fixed rates this week. 

Kiwibank's new fixed card comes into effect on Monday March 23. 

It follows the Reserve Bank's unprecedented official cash rate cut this week to 0.25%, the lowest in history. Banks will be under pressure to pass on rate cuts, will face pressure as term deposit rates fall.

Amid record low bank mortgage rates, non-banks boast the two cheapest rates in the market. Heartland's digital one year mortgage is just 2.89%, while KiwiSaver provider Simplicity's one year rate is available at 2.95% to existing customers.

The state-backed lender's chief executive Steve Jurkovich pledged this week to support Kiwi borrowers amid the financial turmoil caused by the Covid-19 outbreak. 

"Our commitment is to support our customers and the wider New Zealand economy as the Covid-19 situation evolves," Jurkovich said, as the bank slashed floating rates on Monday.

Squirrel's John Bolton expects rates to continue to plummet following the OCR cut. 

He told TMM Online: "I think we’ll have lenders below 3% in the next few weeks but only just below 3%, so like a 2.95% one year special. The attraction of getting a rate below 3% will be too great.  Specials will disappear as credit risks increase, which they will so I’d expect to see lenders looking to try and take extra margin where they can.  I definitely think locking in now is a smart decision."

 

Tags: fixed rate mortgages Kiwibank Lending Mortgage Rates mortgages Steve Jurkovich

« ANZ launches record-low major bank rateHousing market: 6 factors to consider »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.15 3.25 3.39
ANZ Special - 2.55 2.69 2.79
ASB Bank 4.45 2.55 2.69 2.79
Bluestone 3.49 3.49 3.49 3.49
BNZ - Classic - 2.55 2.69 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.15 3.29 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
Lender Flt 1yr 2yr 3yr
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 3.85 3.95 -
HSBC Premier 4.49 2.45 2.60 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 3.69 ▼2.45 2.65 2.79
Kainga Ora 4.43 2.93 3.07 3.24
Kiwibank 3.40 3.30 3.54 3.54
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.55 2.79 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
SBS Bank 4.54 3.05 3.19 3.25
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 2.55 2.69 2.75
The Co-operative Bank - Owner Occ 4.40 2.55 2.69 2.79
The Co-operative Bank - Standard 4.40 3.05 3.19 3.29
TSB Bank 5.34 3.29 3.45 3.59
TSB Special 4.54 2.49 2.65 2.79
Wairarapa Building Society 4.99 3.55 3.49 -
Westpac 4.59 3.15 3.29 3.39
Westpac - Offset 4.59 - - -
Westpac Special - 2.55 2.69 2.79
Median 4.55 3.00 3.13 3.02

Last updated: 21 September 2020 10:48am

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