NZ's largest bank hikes some home loan rates

Homeowners with the country's biggest bank will pay more on their floating mortgages after ANZ lifted a range of home loan, business and overdraft rates by 0.25%.

The bank's floating home loan rate rises from 5.79% to 6.04%, applying to new loans from Wednesday, July 15 and existing borrowers from July 29.

The flexible home loan rate increases from 5.90% to 6.15%, effective July 29.

The move comes as three other major banks – ASB, BNZ and Westpac – also lift their variable home loan rates by 0.25% per annum.

Hikes follow the Reserve Bank's first increase in the official cash rate (OCR) in more than three years, announced last Wednesday.

On the business side, ANZ's term loan floating base rates move up from 4.10% to 4.35%.

There is better news for savers as the premium interest rate on the Serious Saver account rises 0.25% to 1.75% from August 1, lifting the total available rate to 1.80% for customers who avoid withdrawals and deposit $20 or more each month.

An ANZ spokesperson said interest rates would continue to be reviewed in response to international and local market conditions.

"When reviewing interest rates, we consider a range of factors, including the impact on customers, the underlying cost of funds – including wholesale rate movements – and competitor activity," they said.

Other banks also hike

The other three big banks have also hiked floating rates.

BNZ's changes take effect from July 29 for both new and existing customers, with its standard variable rate rising to 6.09%, and three other variable rates all climbing to 6.19%.

The bank is leaving its fixed home loan rates unchanged.

Westpac's floating home and business loan rates all rise 0.25% per annum, from Monday for new customers and next Thursday for existing customers.

ASB lifted its housing variable rate to 6.04% and its Orbit variable rate to 6.14%, effective from Tuesday for new customers and Wednesday for existing customers.

ASB executive general manager personal banking Adam Boyd acknowledged the increases would be difficult for some households.

"Interest rate increases can be difficult for many households," Boyd said.

"We encourage any customers feeling any pressure with their mortgages to get in touch with us early to work through options."