Commonwealth Bank has responded to the Reserve Bank of Australia's cash rate decision.
Reductions for borrowers
- Owner Occupied Principal and Interest Standard Variable Rate home loan reduced by 0.19% per annum (p.a) to a new record low rate of 4.93% p.a.
- Investor Principal and Interest Standard Variable Rate home loans reduced by 0.19% p.a. to 5.51% p.a.
- Owner Occupied Interest Only Standard Variable Rate home loans reduced by 0.25% p.a. to 5.42% p.a.
- Investor Interest Only Standard Variable Rate home loans reduced by 0.25% p.a. to 5.89% p.a.
Offer for savers
- A special 5 month term deposit rate introduced at 2.20% p.a., a 0.20% increase
- Existing CBA pensioner customers will also be eligible for an additional 0.10% p.a. bonus on this special 5 month term deposit, taking the rate to 2.30% p.a.. This bonus is available only in branch.
Commonwealth Bank has responded to the Reserve Bank of Australia's (RBA) cash rate decision by reducing interest rates for home owners and making a deliberate choice to limit the interest rate reduction on the most popular savings account. CBA is also introducing a special term deposit offer.
Angus Sullivan, Group Executive Retail Banking Services said: "With official interest rate settings already at record lows, we are focused on balancing the benefits and the costs of further interest rate reductions between our 1.6 million home loan and over 6 million savings customers.
"We have carefully considered how to respond to this latest official interest rate cut, given that it is not possible to pass on the full rate reduction to over $160 billion of our deposits, including deposits where interest rates are at or already near zero. We have made a deliberate choice to limit the interest rate reduction to 0.15% p.a. on our most popular savings account, NetBank Saver.
"We have also introduced a 5 month term deposit special of 2.20% p.a. together with an additional 0.10% p.a. bonus on this rate for existing CBA pensioner customers.
"We have passed on between 0.19% p.a. and 0.25% p.a. interest rate reductions for our home loan customers. We believe this combination of pricing changes delivers a fair balance of outcomes for both savers and borrowers," Mr Sullivan said.
For principal and interest customers, the standard variable rate has reduced by 0.44% p.a. since June, which on a $400,000 home loan equates to a reduction in the minimum monthly repayment of $108 or more than $1,300 per annum.
For interest only customers, the standard variable rate has reduced by 0.50% p.a. since June, which on a $400,000 home loan, equates to a monthly saving of $167 or an annual saving of $2,000.
"Today's pricing changes are in addition to the fee removals, fee reductions and pre-emptive fee alerts we have already introduced, which have helped to save our customers over $415 million in total," Mr Sullivan said.
Customers who have questions regarding today's rate change are encouraged to speak with us in branch or over the phone.
The Term Deposit special will be available from 8 July 2019.
All other rate changes will take effect from 23 July 2019.
