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Cost pressures have prompted AMP Bank to hike its variable home loan rates for both new and existing customers.
The lender has lifted variable owner-occupied and investor home loan rates by 15 basis points, effect 8 March for new business and 11 March for existing customers.
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AMP Bank chief executive Sally Bruce attributed the decision to increased revenue pressures, partly attributable to the sustained rise in whole sale funding costs.
“The change in variable rates is driven by an increase in costs,” Ms Bruce said.
“We have held off passing this cost on to existing customers for as long as we can. We are managing our loan portfolio in a very active market and decisions on rates are never taken lightly.”
AMP is the latest bank to hike its mortgage rates out-of-cycle, amid similar changes from several lenders throughout 2018 and since the turn of the year.
MyState, NAB and its subsidiary UBank, Macquarie, the Bank of Queensland, Virgin Money, and ING have all announced rate increases since the start of 2019, all citing funding cost pressures.
Rate comparison website Canstar’s group executive of financial services Steve Mickenbecker observed: “AMP is the fourteenth lender to raise their rates since the beginning of February, following the trend of lenders increasing rates to cover their rising costs.
What’s interesting about the AMP rate change is they’ve applied it to both new and existing customers.
The trend we’ve been seeing over the last few months is rates for new customers being reduced, while rates for existing customers have increased.”
He added: “Anyone experiencing a rate rise should see this as a signal to see how their loan is competing in the market today and if they could be getting a better deal.”
Despite the hikes, some lenders have bucked the trend and dropped interest rates on their mortgage offerings, with the likes of Heritage Bank, Teachers Mutual Bank (TRMB), and Adelaide Bank, reducing rates by up to 92 basis points.
AMP, however, has announced reductions to its fixed rate home loan offerings for customers “seeking certainty in a changing market”.
New fixed lending rates for owner-occupiers and investors are as follows:
- 3.99 per cent for three-year Basic and Professional Package investment principal and interest home loans
- 4.06 per cent for five-year Basic and Professional Package owner-occupied principal and interest home loans
The fixed rate changes are also effective from 8 March for new business and 11 March for existing customers.
AMP Capital appoints new CIO
AMP Capital has announced that Debbie Alliston has been appointed as chief investment officer for its multi-asset group, effective immediately.
Commenting on the appointment, AMP Capital global head of public markets Simon Warner said: “I’m very pleased to announce that Debbie will be leading the Multi-Asset business. Debbie has an excellent understanding of the business and how we can execute our strategic priorities in a dynamic market.
“Debbie is ideally placed to take on this role, and deliver superior outcomes for our clients, having been the head of multi-asset portfolio management for seven years.
“Her appointment is another great example of promoting quality talent from within our organisation,”
Reporting to Simon Warner, Ms Alliston will have responsibility for the portfolio management, dynamic markets, market solutions and tailored investment solutions teams.
Ms Alliston will also continue to have responsibility for portfolio management of the future directions and AMP Lifecycle funds.
[Related: Bank to fuel broker ‘momentum’ with sharp rate cuts]
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