BNZ enters price war with 3.05% fixed mortgage
BNZ has launched a 3.05% 18 month fixed mortgage, the joint-cheapest ever offered by a major bank.
Friday, March 20th 2020, 5:25PM
The sharp new rate is available to owner-occupiers and investors as of Monday.
It comes as the bank, led by Angie Mentis (pictured), also slashes its one year rate to 3.09%, the joint-second cheapest in the market.
BNZ's two year rate drops to 3.35%, level with ANZ, but more expensive than ICBC, China Construction Bank and HSBC Premier.
The rate cuts come several days after most banks slashed their variable rates in line with the central bank's 75 basis point rate cut.
BNZ, ANZ and Kiwibank are the only lenders to make cuts to their fixed rate cards as of March 20.
BNZ's "Standard" home loans, for those with less than a 20% deposit, also see cuts. The standard one year is 3.75%, 18 month is 3.95% and two year is 4.10%.
BNZ's matcher of 3.05% on 18 months hints at a price war among the big four and larger domestic rival Kiwibank.
Advisers including Squirrel's John Bolton have told TMM they expect rates to dip below the 3%, unthinkable a year or two ago.
However, NZ lenders are under pressure as they rely on overseas funding, and will also see reduced income from term deposits.
"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," Bolton told TMM this week.
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