RBA Governor Michele Bullock has delivered a rate increase. Picture: Christian Gilles
ANALYSIS
Some banks were slow to pass on rate cuts to borrowers last year, with a number of lenders dragging their heels for weeks, or even months, before granting their customers some long awaited mortgage relief.
History tells us that rate hikes are a different story however.
Banks tend to waste no time passing on an interest-rate increase, with some not even waiting for the RBA before they start raising rates.
I’m looking at you, the 54 lenders who raised rates on some of their loan products in the fortnight leading up to the RBA’s first meeting of the year in February.
Last year, our shame list shone a light on the lenders who were dragging the chain or trying to get away with partial rate cuts for borrowers, rather than passing on the full 0.25 per cent reductions.
MORE:RBA warned it’s playing with fire
What will your bank do now that rates are on the way up again? Picture: William West
SCROLL DOWN TO SEE IF YOUR LENDER HAS HIKED RATES
Now that the cash rate has been hiked to 3.85 per cent, we thought we’d see if they take as long to act, or whether, in hope against hope, they decide not to pass on a rate hike, or at least not pass it on in full.
But don’t get your hopes up, according to Finder head of consumer research Graham Cooke.
“Previous Finder research shows that Australia’s biggest banks have been quick to pass on the full effect of interest rate rises, while often not passing on full rate cuts. This has had a big impact on borrowers with variable rate home loans,” Mr Cooke said. “The data show banks were less generous in the good times when the RBA lowered the cash rate repeatedly in 2019 and 2020. The Big Four passed on less than the full cut some months.
MORE:Trashed Aus homes’ wild price tag
All eyes are now on the banks. Picture: Britta Campion
“In 2025, however, basically all banks passed on the full cut due to the immense pressure on them as a result of the cost of living crisis. So, times have changed.”
Mr Cooke said banks justify their actions by pointing towards their own funding costs and their legal obligations towards their profits and shareholders.
“While it doesn’t seem fair that banks are traditionally better at passing on interest rate rises than interest rate cuts, the big banks are balancing lots of different customer demands. This includes the need to keep savings rates at a certain level, which tend to fall when home loan rates rise and vice versa,” he said.
MORE:Mass of households have over $1m debt
“Whether you have a home loan with a Big Four bank or a small online lender, getting a good deal is ultimately the borrower’s responsibility. Other Finder research has found that the difference between the average and lowest rates in the market is equivalent to one rate cut – so if your rate goes up, switching could be a hedge against that.”
Graham Cooke, head of consumer research at Finder.
LENDERS TO HIKE – BEST RATES % (For 80% LVR owner occupier loans, paying principal and interest)
TBA
LENDERS YET TO HIKE – BEST RATES % (For 80% LVR owner occupier loans, paying principal and interest)
AMP- 5.43
ANZ- 5.5
Arab Bank of Australia- 8.54
Athena- 5.64
Aussie- 5.33
Australian Military Bank- 6.39
Australian Mutual Bank- 5.24
Auswide Bank- 5.34
Bank Australia- 5.39
Bank First- 5.34
Bank of China Limited- 5.18
Bank of Melbourne- 5.64
Bank of Queensland- 5.38
Bank of Sydney- 5.29
Bank of us- 5.39
Bank Orange- 5.39
BankSA- 5.64
BankVic- 5.35
BankWAW- 5.24
Bankwest- 5.49
BCU Bank- 5.29
Bendigo Bank- 5.38
Beyond Bank- 5.59
Bluestone- 6.29
Border Bank- 5.09
Broken Hill Bank- 6.39
Cairns Bank- 5.54
Central Murray Bank- 5.49
Central West Credit Union- 6.65
Coastline Bank- 5.49
CommBank- 5.39
Community First- 5.24
Credit Union SA- 5.39
Darling Downs Bank- 5.64
Defence Bank- 5.69
Dnister- 5.54
Easy Street- 5.34
Family First Credit Union- 5.40
Fire Service Credit Union- 5.49
Firefighters Mutual Bank- 5.44
First Option Bank- 5.44
Firstmac- 5.68
Freedom Lend- 5.14
G & C Mutual Bank- 4.99
Gateway Bank- 5.44
Geelong Bank- 5.74
Goulburn Murray Credit Union- 5.44
Great Southern Bank- 5.49
Greater Bank- 5.19
Heritage Bank- 5.34
homeloans.com.au- 5.74
Homestar- 5.34
Horizon Bank- 5.14
HSBC- 5.34
Hume Bank- 5.34
Illawarra Credit Union- 5.24
IMB- 5.29
ING- 5.39
La Trobe Financial- 5.69
Laboratories Credit Union- 5.10
Liberty Financial- 5.74
loans.com.au- 5.29
Macquarie Bank- 5.39
ME- 5.38
Mortgage House- 5.19
MOVE Bank- 5.14
MyState- 5.34
NAB- 5.69
Newcastle Permanent- 5.24
Northern Inland Credit Union- 5.24
NRMA Home Loans- 5.33
P & N Bank- 5.44
Pacific Mortgage Group- 5.14
People’s Choice Credit Union- 5.34
Pepper Money- 6.34
Police Bank- 5.09
Police Credit Union- 5.24
Qantas Money- 5.48
QBANK- 5.34
Qudos Bank- 5.29
Queensland Country Bank- 5.19
RACQ Bank- 5.29
Reduce Home Loans- 5.29
Regional Australia Bank- 5.34
Resi- 6.34
RESIMAC- 5.74
South West Slopes Bank- 5.10
Southern Cross Credit Union- 5.48
St. George- 5.64
Sucasa- 5.64
Summerland Bank- 5.29
Suncorp Bank- 5.40
Teachers Mutual Bank- 5.44
The Capricornian- 5.34
The Mac- 5.17
The Mutual Bank- 5.19
Tiimely Home- 5.29
Transport Mutual Credit Union- 5.14
Ubank- 5.39
UniBank- 5.44
Unity Bank- 4.99
Unloan- 5.19
Up Bank- 5.20
Virgin Money- 5.19
Well Money- 5.44
Westpac- 5.34
WLTH- 5.50
Yard- 6.43
Yellow Brick Road- 6.34
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