HSBC Bank Australia has filed in after the Big Four and announced a drop in its fixed rates earlier this week.

The bank’s head of home loans, John Lane, attributed the cuts to a “significant reduction in the medium and long-term cost of fixed rate funds in the commercial market.”

New borrowers will be privy to the bank’s most attractive offer with three-year fixed rates for new customers being cut from 9.29% to 7.99%, while existing customers will see one-, two- and three-year fixed rate loans come down to 8.99% and four- and five-year fixed rate loans drop to 8.90%.

However, speaking to Broker News on the subject of fixed rate cuts, one broker expressed hopes that borrowers would not fall into the fixing trap. “I think many clients will see the falling rates and all the press about the RBA lowering rates as a reason not to fix. At least that’s what I hope, as with predictions of 0.75–1.00% rate cuts in the near future they’d be crazy to fix their rates,” he said.

The Big Four cut between 0.2 percentage points and 0.5 points off their fixed rates earlier in the month. Non-bank lenders RAMS, The Rock Building Society and Macquarie Mortgages were the latest additions, dropping fixed rates on Friday 15 August.