ANZ shocks by not passing on full RBA rate cut

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The RBA has finally taken the plunge, cutting the cash rate to a new low of 1.25 per cent. If lenders pass the rate cut on in full, the average mortgage holder will save around $58 a month or $700 a year.

ANZ has shocked the market by not passing on the full cut, instead opting to give their variable home loan customers a 0.18 per cent cut.

In contrast, Athena, RACQ and Reduce Home Loans have announced they’ll be passing on the full 0.25 per cent cut.

Keep across the changes with RateCity’s live list of who is cutting, by how much and when:

This takes the lowest ongoing variable rate to 3.19 per cent, from Reduce.

Sally Tindall, research director at, said all lenders needed to step up and pass on the cut in full.

“ANZ’s decision to not pass on today’s cut in full is a huge disappointment and now all eyes will on the remaining Big Banks to see if they can go one better,” she said.

“Reduce, RACQ and Athena were the first out of the starting blocks. This now puts immediate pressure on other lenders to pass the full cut on to both their new and existing customers.

“This rate cut will provide some much-needed relief to mortgage holders feeling the pinch,” she said.

For the average home owner, today’s cut gives them up to $58 extra to put towards the electricity bills, the groceries or the never-ending cost of raising kids,” she said.

“Importantly, for many families, it will also be a chance for to get ahead on their loan,” she said.

“Australia’s household debt to disposable income ratio remains at a record high at 189.6 per cent and continues to be a pressing concern for the RBA,” said Sally Tindall. analysis shows if the average mortgage holder put a rate cut of $58 a month back into their loan, they could save up to $18,523 in interest over 30 years and shave up to 1 year, 7 months off their mortgage.

Impact of 0.25% rate cut on average home loan rates


Loan Amount Old Rate New Rate Monthly Difference Annual Difference
$300,000 4.31% 4.06% -$44 -$525
$400,000 4.31% 4.06% -$58 -$700
$500,000 4.31% 4.06% -$73 -$875
$750,000 4.31% 4.06% -$109 -$1,312
$1 million 4.31% 4.06% -$146 -$1,749



* Based on’s average variable rate of 4.31% for owner occupiers paying principal and interest over 30 years.

Who’s moved?



Lender Cuts Date effective New lowest variable rate
ANZ 0.18% 14 June 3.63%
Reduce Home loans Up to 0.25% Immediately 3.19%
Athena 0.25% Immediately 3.34%
RACQ 0.25% Next week 3.44%



How to ensure you get a rate cut

  1. Call your bank and ask them whether they are cutting your rate, by how much and when.
  2. Check what other lenders are offering. Even if your bank is passing on the cut, you might find a better deal from a competitor.
  3. If your bank doesn’t pass on the cut in full, or you discover you’re paying too much, consider switching. The beauty of a variable home loan rate is that you’re well within your right to take your business elsewhere.

How to put a rate cut back into your home loan

  1. Find out if your bank is passing on the rate cut, and by how much.
  2. Work out what your new monthly repayments will be and what this means for your budget.
  3. If you decide to put that money back into your mortgage, call your lender up and ask them to keep your monthly repayments the same. 

Note: the average mortgage holder is an owner occupier paying principal and interest with a $400K mortgage on an average rate of 4.31 per cent.

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