Major trims fixed rates

by Adam Smith09 May 2012

A major bank has carved its fixed rates following its partial pass-on of the Reserve Bank's cash rate cut.

CBA has trimmed rates on its one- and three-year fixed rate loans, following a 40bp cut to its standard variable rate last week. The bank cut 15bps from its one-year rate, to bring the rate to 5.99%, while it decreased its three-year rate by 34bps, also to 5.99%.

CBA claimed the move brought its fixed rate products to their lowest levels in more than three years. It said the rate was the lowest amongst the majors for one- and three-year fixed rates.

CBA last week lowered its standard variable rate 40bps to 7.01%, holding onto 10bps of the Reserve Bank's cash rate cut. Recent research from RateCity 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.

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COMMENTS

  • by Allan Faint 9/05/2012 10:24:29 AM

    my understanding is they have kept 1.5% since 2007.

  • by Warwick 9/05/2012 2:34:17 PM

    Average loan of $350,000,Mortgage Advantage fee of $375=0.11%. So the 5.99% becomes 6.10%. Sounds like a "Labor budget"