Stubborn banks still yet to pass on May RBA rate cut

ANALYSIS

Call the police! There’s a bank robbery in progress.

But wait, this isn’t your regular heist…think balaclava, guns out at the teller window, unmarked bills, getaway car waiting outside…

No, the term bank robbery has a whole new meaning these days. It refers to a bank robbing you.

See, historically, whenever the RBA raises interest rates, banks fall all over themselves to pass on the hikes in full to their customers.

But in the past, when the RBA cut rates, the desperation would just magically disappear.

Let’s face it, banks don’t like to give you back money they don’t need to. Before February this year, there had been 10 RBA rate cuts over the past 10 years. Of these, only four were passed on in full by commbank, NAB and ANZ. Westpac only passed on two of them.

Meanwhile, since 2022, there have been 13 rate hikes and – you wouldn’t read about it- all 13 were passed on in full.

MORE NEWS

When is the next RBA rates meeting in 2025?

Australian mortgage holders ‘can’t be bothered’ refinancing to a better deal

Why luxury home dream could be out of reach for millions

The good news is, things are finally beginning to change. In February, the rate cut was so eagerly anticipated that the big four banks announced immediately they would pass it on in full.

The majority of the 111 lenders monitored by comparison site Finder quickly began to follow suit. For those that didn’t, we created a shame file, listing all the lenders who had not passed on cuts and taking them off the list when they eventually did.

When May came around, lenders were ready to go, so our next shame file had fewer lenders on it and reduced quickly.

Now, we’re left with just a handful of lenders.

SEE THE LIST OF BANKS YET TO PASS ON THE MAY CUT BELOW

On an average Aussie loan of just above $600,000, a single rate cut of 0.25 per cent will save about $1200 a year. A double rate cut will save $2400 a year.

Those savings increase significantly for the vast number of Aussies with higher mortgage balances than the average.

MORE NEWS: Bank mistake costing you $36k

Finder’s head of consumer research Graham Cooke said bank competition had prompted lenders to act quickly.

“The competitive landscape among lenders plays a significant role. If one major bank passes on the full cut, others are often pressured to do the same to avoid losing customers,” Cooke said.

“Even if the full cut isn’t passed on by your current lender, the competitive environment means there will likely be better deals available elsewhere. This makes refinancing crucial for homeowners looking to maximise their savings.

“A reduction of even half a per cent can be the difference of thousands of dollars a year.

“Shop around to find a variable home loan that offers a lower interest rate than your current provider. The very lowest rates now have a ‘5’ in front of them.”

With that in mind, here is the full list of lenders on Finder’s books and their best variable rate.

Banks who have cut, new best rate (%), effective date

ANZ: 5.59- 30 May

CommBank: 5.59- 30 May

NAB: 5.94- 30 May

Westpac: 5.59- 3 June

Adelaide Bank: 5.79- 6 June

AMP: 5.64- 2 June

Arab Bank Australia: 5.45- 3 June

Athena: 5.74- 20 May

Aussie: 5.69- 6 June

Australian Military Bank: 5.64- 3 June

Australian Mutual Bank: 5.39- 1 June

Australian Unity: 5.54- 4 June

AusWide Bank: 5.59- 5 June

Bank Australia: 5.63- 2 June

Bank First: 5.49- 29 May

Bank of China: 5.43- 3 June

Bank of Melbourne: 5.79- 3 June

Bank of Sydney: 5.54- 3 June

Bank of us: 5.64- 11 June

Bank Orange: 5.44- 2 June

BankSA: 5.79- 3 Jun

BankVic: 5.48- 3 June

BankWAW: 5.29- 3 June

Bankwest: 5.69- 30 May

bcu: 5.49- 10 June

Bendigo Bank: 5.64- 6 June

Beyond Bank: 5.64- 3 June

Bluestone: 6.54- 11 June

BOQ: 5.63- 6 June

Border Bank: 5.34- 27 May

Broken Hill Bank: 6.39- 4 June

Cairns Bank: 5.74- 4 June

Central Murray Credit Union: 6.74- 2 June

Central West Credit Union: 5.79- 29 May

Coastline Credit Union: 6.44- 29 May

Community First Bank: 5.49- 11 June

Credit Union SA: 5.49- 4 June

Defence Bank: 5.59- 28 May

Dnister: 5.59- 3 June

Easy Street: 5.59- 4 June

Fire Service Credit Union: 5.59- 1 June

Firefighters Mutual Bank: 5.49- 1 June

Firstmac: 5.78- 3 June

First Option Bank: 5.49- 2 June

Freedom Lend: 5.65- 16 June

G & C Mutual Bank: 5.49- 1 June

Gateway Bank: 5.45- 27 May

Geelong Bank: 5.64- 30 May

Goulburn Murray Credit Union: 5.69- 3 June

Greater Bank: 5.49- 30 May

Great Southern Bank: 5.64- 3 June

Heritage Bank: 5.49- 30 May

Homeloans: 5.89- 11 June

HomeStar Finance: 5.49- 16 June

Horizon Bank: 5.39- 1 June

HSBC: 5.49- 2 June

Hume Bank: 5.49- 2 June

Illawarra Credit Union: 5.49- 4 June

IMB: 5.54- 30 May

ING: 5.64- 3 June

Liberty Financial: 5.99- 3 June

loans.com.au: 5.49- 3 June

Macquarie Bank: 5.64- 23 May

ME: 5.63- 7 June

Mortgage House: 5.39- 6 June

MOVE Bank: 5.44- 1 June

MyState Bank: 5.54- 5 June

Newcastle Permanent: 5.49- 30 May

NICU: 5.49- 1 June

NRMA Insurance Home Loan: 5.53- 6 June

P & N Bank: 5.63- 10 June

Pacific Mortgage Group: 5.39- 2 June

People’s Choice Credit Union: 5.39- 30 May

Pepper Money: 6.04- 5 June

Police Bank: 5.34- 27 May

Police Credit Union: 5.49- 1 June

Qantas Money: 5.68- 6 June

QBank: 5.49- 6 June

Qudos Bank: 5.44- 29 May

Queensland Country Bank: 5.49- 4 June

RACQ Bank: 5.39- 3 June

Regional Australia Bank: 5.44- 4 June

resi: 6.39- 20 May

RESIMAC Financial Services: 5.89- 11 June

Southern Cross Credit Union: 5.73- 1 June

South West Slopes Bank: 5.70- 3 June

St. George: 5.79- 3 June

Sucasa: 6.05- 5.89- 16 June

Summerland Bank: 5.34- 3 June

Suncorp: 5.65- 30 May

Teachers Mutual Bank: 5.49- 1 June

The Capricornian: 5.39- 6 June

The Mac: 5.42- 4 Jun

The Mutual Bank: 5.49- TBC

Tiimely Home: 5.54- 6 June

Transport Mutual Credit Union: 6.44- 2 June

Ubank: 5.59- 29 May

UniBank: 5.49- 1 June

Unity Bank: 5.49- 1 June

Unloan: 5.49- 20 May

Up Home Loan: 5.50- 1 June

Virgin Money: 6.19- 6 June

Warwick Credit Union: 5.89- 4 June

Woolworths Team Bank: 5.69- 10 June

Yard: 5.89- 6 June

Yellow Brick Road: 6.39- 20 May

Shame list: Banks yet to cut

Family First Credit Union: 5.70

La Trobe: 6.54

Laboratories Credit Union: 5.95

Reduce: 5.74

Well Money: 5.81

MORE: Finder’s full list of lenders and their updated rates here