National Australia Bank is cutting its variable mortgage rates by 0.25 percentage points, passing on the Reserve Bank's rate cut in full.
The move, effective from May 16, will trim about $47 from the average monthly repayment on a 30-year $300,000 mortgage.
The big four banks have attracted criticism for not passing on in full previous rate cuts, and there has been uncertainty about whether any cut would flow through this time due to the banks' need to raise additional capital through product repricing.
NAB on Tuesday said its standard variable rate for owner occupiers will drop from 5.60 per cent to 5.35 per cent, with the rate for investor rates dropping from 5.75 per cent to 5.50 per cent.
"The circumstances of each decision will always vary and we must take into account factors such as competition, regulatory capital requirements and funding costs," NAB personal banking group executive Gavin Slater said in a statement.
"Today's decision balances the needs of our home loan customers with our shareholders."
NAB will also reduce its rate on standard variable business lending products by 0.25 percentage points.
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