Australia’s ‘Big Four’ lenders lift home loan rates in step with central bank

Australia’s ‘Big Four’ lenders – Commonwealth Bank of Australia (CBA.AX), National Australia Bank (NAB.AX), Westpac Banking Corp (WBC.AX) and Australia and New Zealand Banking Group (ANZ.AX) – will raise home loan rates by 0.25% per annum, the lenders said on Tuesday.

The move is in sync with the country’s central bank, which earlier in the day raised its benchmark lending rate by 25 basis points. Australian banks have so far followed the steps of the Reserve Bank of Australia (RBA) in raising borrowing costs.

Bank shares rose after the latest hike by the RBA, which was softer than the 50 basis point increase predicted by a Reuters poll. The central bank said it slowed the pace of monetary tightening as it has already raised rates substantially.

The financial index (.AXFJ) closed 4.2% higher, marking its best day since June 2020.

The new rates by CBA, ANZ and NAB will come into effect from Oct. 14, while Westpac’s rates will be effective Oct. 18.

Westpac, ANZ and CBA also raised interest rates on some of their deposit products, while NAB said its savings and term deposit rates were “continually under review”.