Westpac defends 45 points increase

Friday December 4, 2009

Westpac has come under fire from the Federal Treasurer and consumers after breaking away from the central banks official interest rates and raising its own rates by a massive 45 basis points, well above the 25 points recorded by the Reserve Bank.

People with the Westpac standard variable mortgage rate will now be subject to paying an additional $84 per month for an average $300,000 mortgage while those who are with banks that remain with the Reserve Bank will be paying an additional $48 for the same mortgage. When this is added to the previous two months increases, Westpac customers are now paying a significant $176 extra to the average $300,000 mortgage while other banks customers that are staying with the Reserve Bank are at an extra $140 for the same mortgage amount.

To date, none of the other Big four banks have made statements regarding their actions for their own interest rates.

Treasurer Wayne Swan has blasted Westpac for its actions of raising its rates almost double that of the central banks, saying the bank tried to hide its actions behind the leading news of the Liberal party's leadership changes.

''I see no justification at all for this move by Westpac, cynically trying to use the cover of today's other events,

''Westpac and any other bank that follows Westpac's cynical lead have given their customers a slap in the face for Christmas this year. I think Westpac and any other bank that follows Westpac's lead can expect a very severe backlash from their customers and from the community generally.'' Treasurer Swan stated.

However, Westpac has defended its 45 basis points rise with the banks group executive in charge of retail and business banking, Peter Hanlon, releasing a written statement saying that Westpac has previously withheld charging its customers all its high funding costs to provide support during the worst of the economic downturn.

''While it is now necessary for us to pass on some of these increased funding costs, we will continue to take a considered approach to managing the impact on our customers of the challenging funding environment,'' the statement said.

Banks.com.au is a complete banking services information website, compare here to find out if you are getting the best deal on all your banks home loans

Back to News Index | Back to Home