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Jessica Darnbrough
Three of Australia’s major lenders have failed to adhere to the pleas of Treasurer Wayne Swan, opting to pass on just part of the Reserve Bank’s rate cut.
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Last week, Mr Swan urged all of the majors to pass on the full 25 basis point rate cut to their borrowers.
Speaking to ABC radio, Mr Swan said there was no justification for the banks refusing to pass the rate cut on in full.
“The fact is that their net interest rate margins are back at the level they were prior to the Global Financial Crisis,” he said.
Despite Mr Swan’s pleas, National Australia Bank, the Commonwealth Bank of Australia, and Westpac all failed to pass on the rate cut in full.
On Friday last week, both CBA and NAB announced they would pass on a 20 basis point rate cut to their borrowers.
Effective from this Friday, CBA will offer a standard variable rate of 6.60 per cent, while NAB will offer an SVR of 6.58 per cent.
Westpac, on the other hand, passed on just 18 basis points to borrowers - taking its standard variable rate to 6.71 per cent.
NAB’s group executive personal banking chief Lisa Gray said the bank’s decision was not taken “lightly” and the lender had “sought to strike the right balance" between offering the lowest standard variable rate of the big four and "our obligations to ensure Australian banks are safe and secure".
"The increased competition for deposits is pushing up costs, making it more expensive to fund our lending," Ms Gray said.
