CBA is the first major bank off the blocks, cutting variable rates by 0.13 per cent for owner-occupiers paying principal and interest.
CBA has passed on the full 0.25 per cent cut to investors paying interest only. The rate cuts take effect on 22nd October and are for new and existing customers.
The move brings CBA’s lowest variable rate down to 3.22 per cent, making it the lowest of all the big banks at this stage.
For the average existing CBA customer on the lowest rate, this translates to a saving of $29 per month, or $343 per year.
Paul Marshall, chief executive at RateCity.com.au, said: “CBA’s variable home loan customers will be disappointed by the banks’ decision not pass on a bigger cut.”
“As a result, the average CBA home loan customer, on the lowest rate will miss out on $26 per month, or $314 per year.
“The banks are between a rock and a hard place when it comes to passing on rate cuts, because it is a balancing act to satisfy their borrowers, savers and shareholders as rates dip closer to zero.”
Impact of 0.13% C BA rate cut
Savings per month
Missed savings per month
Savings per year
Missed savings per year
Standard Variable Rate
Discounted Variable Rate
Lowest variable rate
Note: The rates are for owner-occupiers paying principal and interest on a $400,000 loan. Missed savings are calculated based on what a customer would have saved if CBA had passed on the full rate cut of 0.25 per cent.
LIVE UPDATES: https://www.ratecity.com.au/rba-cash-rate