Westpac NZ slashes home loan rates after OCR cut, 3-year fixed now just 4.95%, check full list

Time of India

6 days ago

Westpac New Zealand has quickly responded to the Reserve Bank of New Zealand's (RBNZ) recent decision to lower the Official Cash Rate (OCR) by 25 basis points to 3.25%, announcing reductions in lending and deposit rates.
Effective Thursday, May 29, 2025, Westpac NZ is offering special fixed home loan rates of 4.95% per annum across one, two, and three-year terms.
This move positions Westpac's three-year rate as the lowest among the five major banks in New Zealand. Additionally, the bank has reduced its six-month fixed special rate to 5.49% per annum.
Westpac mortgage rates (variable) have also been adjusted downward by 0.15% annually. This change means that since July of the previous year, customer variable rates have decreased by over 2.00% per annum.
Furthermore, most variable business lending rates have been reduced in line with the 0.25% OCR decrease.
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According to advertised rates as of 3 PM on May 28, Westpac's new special rate of 4.95% per annum is the lowest three-year rate among the five largest banks.
This rate is significantly lower than the average of 5.40% per annum over the past ten years.
Savers are closely monitoring the rate decline, and support for them remains a priority, as per Westpac. That's why the 0.25% OCR reduction has not been applied to the Notice Saver product, which continues to offer a rate of 3.10% per annum.
Additionally, Westpac is decreasing its mortgage serviceability rate from 7.00% to 6.85%.
Sarah Hearn, Westpac NZ's General Manager of Product, Sustainability, and Marketing, said the bank's commitment is to providing value to customers in a competitive environment. She stated, "We'll continue to look for opportunities to pass on interest rate reductions to ensure we're providing customers with good value."
Hearn also acknowledged many New Zealanders' financial challenges, encouraging customers to engage with the bank if they have concerns about their finances.
The RBNZ's decision to lower the OCR to 3.25% marks the second consecutive reduction, bringing the rate to its lowest level since September 2022. The central bank cited a recovering economy and inflation within the target range as reasons for the cut.
However, it also noted ongoing challenges, including global economic uncertainties and the impact of tariffs, which could affect future growth and inflation.
Fixed home loan rates (Special, effective from May 29)
Term
New Rate (p.a.)
Change
6 months
5.49% p.a.
-0.10%
1 year
4.95% p.a.
-0.04%
18 months
4.95% p.a.
-0.04%
2 years
4.95% p.a.
-0.04%
3 years
4.95% p.a.
-0.24%
4 years
5.39% p.a.
No Change
5 years
5.39% p.a.
No Change
Fixed home loan rates (Standard, effective 29 May 2025)
Term
New Rate (p.a.)
Change
6 months
6.09% p.a.
-0.10%
1 year
5.55% p.a.
-0.04%
18 months
5.55% p.a.
-0.04%
2 years
5.55% p.a.
-0.04%
3 years
5.55% p.a.
-0.24%
4 years
5.99% p.a.
No Change
5 years
5.99% p.a.
No Change
Variable home loan rates (effective from June 3, 2025, for new customers and on June 5, 2025, for existing customers)
Term
New Rate (p.a.)
Change
Choices Floating
6.59% p.a.
-0.15%
Choices Offset
6.59% p.a.
-0.15%
Choices Everyday
6.69% p.a.
-0.15%