Big four have held back 55bps from borrowers

by Adam Smith08 May 2012

The major banks have held back an average of 55bps of the RBA's cash rate cuts since September 2008.

Research from RateCity has indicated that the big four hold back on average of 15bps for every 50bps cut by the Reserve Bank. As a result, the major banks have kept an average of 55bps from RBA cuts since September of 2008.

The comparison site pointed to the current benchmark variable rate of 7.40%, and claimed that the benchmark rate would currently be 6.86% had the major banks followed the RBA.

RateCity pointed to the three rate cuts to come from major banks thus far, with NAB, Westpac and CBA all announcing decreases below the 50bp Reserve Bank move. The company said each bank had held back at least 10bps, and predicted ANZ would do the same when it announces its rate decision on Friday.

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