ANZ cuts rates by 20 basis points

12 Oct 2012, 6:06 pm   -   Source: AAP
ANZ Banking Group has cut its standard variable rates on home loans by 20 basis points. (AAP)

ANZ Banking Group has cut its standard variable rates on home loans by 20 basis points. (AAP)

ANZ has joined CBA and NAB in cutting its standard variable rates on home loans by 20 basis points, less than the RBA's recent rate cut.

ANZ Banking Group has cut its standard variable rates on home loans by 20 basis points, in line with most of its rivals.

ANZ will reduce its standard variable home loan rates from 6.8 per cent to 6.6 per cent, effective from October 19.

The rate cut will save customers with an average home loan of $280,000 about $10.75 per week and $560 per year, ANZ said on Friday.

The move follows the Reserve Bank of Australia's 25 basis point cut to the cash rate on October 2.

National Australia Bank and Commonwealth Bank have since reduced their standard variable rates by 20 basis points, while Westpac cut by 18 basis points.

Offshore funding costs have stabilised, but the cost of attracting deposits is higher, ANZ Australia chief executive Philip Chronican said.

"Recent stability in wholesale funding markets has been offset by the impact of intense competition for retail deposits as banks seek to improve their funding mix in response to market and regulatory pressures," he said in a statement.

"While this increase in competition is benefiting the majority of our customers, through historically high deposit rates relative to the cash rate, last week's decision from the RBA (Reserve Bank of Australia) has provided some scope to once again reduce our variable lending rates."

ANZ's 20-basis point cut will also apply to loans to small businesses, the bank said.

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