Big banks cut mortgage rates

The Commonwealth Bank and Westpac have followed the Reserve Bank’s lead and cut their standard variable interest rates on home loans.

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The Commonwealth Bank announced the rate cut on Twitter, saying: “We’re reducing the interest rate on our SVR home loan account by 0.25% p.a., effective Friday, 20 February. Our new SVR is 5.65% p.a.”

Westpac also announced its decision on Twitter, saying: “We are reducing our home loan Standard Variable Interest Rate by 0.28% to 5.70% pa, effective Friday 20 February 2015.”

The announcements follow the Reserve Bank’s decision yesterday to cut the cash rate to an historic low of 2.5 per cent.

It makes the Commonwealth Bank and Westpac the first of the big four to pass on the saving to customers. NAB yesterday tweeted that its rates are “currently under review”. ANZ has said it will make an announcement on Friday 6 February.

ME Bank and Bank of Queensland, meanwhile, announced yesterday that they would pass the 0.25 per cent rate cut on to their customers.

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