Non-major lifts variable home loan rates

by Julia Corderoy07 Apr 2016
Non-major lender Bank of Queensland (BOQ) has increased variable rates on owner occupied and investment home loans.

According to the announcement today, variable interest rates will be increased by 0.12% for owner-occupiers and 0.25% for investors. 
 
The increase will see the Bank’s Clear Path variable rate home loan lift to 4.72% for owner-occupiers and 5.14% for investors. 

The standard variable rate home loan will move to 5.86% for owner-occupiers and 6.28% for investors. 

 BOQ CEO Jon Sutton said the changes were driven by the need to balance growth, risk and margins over the longer term. 
 
“This is not a decision that was made lightly and we were very mindful of the impact on our customers even in an environment where interest rates remain at very low levels,” he said. 
 
“However, given the fiercely competitive market and increased funding spreads and hedging costs, these increases are necessary to help us achieve the appropriate balance between growth, asset quality and profitability. 

The new rates will be effective from 15 April 2016.

This announcement comes just after APRA chairman Wayne Byres told the Australian Financial Review (AFR) Banking and Wealth Summit that the regulator will maintain an acute focus on ensuring banks continue to build resilience now.

“The main message I want to talk about today is that it is better we continue to invest in building resilience now when it can be done in an orderly manner from a position of relative strength than try to do so in more difficult times,” Byres said.

“Achieving this objective will involve work in four broad areas, and take the next several years to fully implement.

“The four areas I have highlighted are: reinforcing capital strength; improving the stability of liquidity and funding profiles; enhancing both the public and private sectors’ readiness for adversity; and strengthening the risk culture within the financial system.”
 

COMMENTS

  • by Richard 7/04/2016 11:20:06 AM

    Classic scenario of deceiving borrowers into taking up special offers and then moving the goal posts out of any interest rate cycle. Both borrowers and brokers need to be VERY mindful of third and fourth tier lenders that practise this type of price gouging.

  • by Discount Variable 7/04/2016 11:50:45 AM

    Bank of Qld. As a broker discuss your experience in under 2,000 words.

    A special case that might require its own forum.

  • by Marty McDonald 7/04/2016 12:32:22 PM

    Firstmac did same by bringing in a new product line. Bankwest has history also. Wake up fellow brokers and dont just support lenders based on their latest rate campaign! Look at past history.