No home loan under 2% yet ANZ cuts savings account to 0.5%

author-avatar By on November 19, 2020
No home loan under 2% yet ANZ cuts savings account to 0.5%

Source: Wikimedia Commons

In another blow for savers, ANZ has cut its savings account more than the 15 basis point cut prescribed by the Reserve Bank.

ANZ's 'Progress Saver' account was cut by 20 basis points, for a maximum rate of 0.5% if $10 per month is deposited, with no withdrawals made.

Its standard five-month introductory rate was also cut by 20 basis points to 0.45%, which moves to an ongoing rate of just 0.05% after the introductory period ends.

ANZ also slashed various term deposits by 20 basis points, with the highest rates achievable 0.60% p.a. on a 60 month (5-year) term.

ANZ's savings account rate sits a full 100 basis points or more below some of the highest interest rates in the market, as seen below.

The major bank was the only one of the big four to not introduce a home loan under 2% after the Reserve Bank's cash rate decision two weeks ago.

CBA, Westpac, and NAB all introduced home loans under 2% for borrowers willing to fix for four years on a packaged home loan.

The equivalent home loan ANZ offers is the 'Breakfree Package', fixed for four years at 2.29% p.a. (3.77% p.a. comparison rate*).

ANZ also has a one-year Breakfree Package at 2.09% p.a. (4.13% p.a. comparison rate*).

As it stands, this sits around 30 basis points higher than some of the more competitive home loan rates in the market, and its comparison rate is around a full 2 percentage points higher, as seen below.

Lender
Advertised rate Comparison rate Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval
VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
VariableMore details
YOU COULD WIN $100k TO PAY DOWN YOUR LOAN*

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • For a chance to win $100K towards your home loan, apply with Athena before Oct 31 & be approved by Dec 15
  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match
YOU COULD WIN $100k TO PAY DOWN YOUR LOAN*

Owner Occupier Accelerates - Celebrate (LVR < 60%) (Principal and Interest)

  • For a chance to win $100K towards your home loan, apply with Athena before Oct 31 & be approved by Dec 15
  • We lower your rate based off how much you’ve paid down your loan
  • Automatic rate match

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. Rates correct as of October 20, 2021. View disclaimer.

November's RBA rate cut caused concern for pensioners, as the deeming rates are still at 0.25% on the low end, and 2.25% on the high end.

They are the rates the government deems a pensioner's assets to be earning.

National Seniors Australia chief advocate Ian Henschke told Savings.com.au two weeks ago the "double whammy" forces retirees to look to the more volatile sharemarket.

“If the whole point of the Reserve’s decision today is to try to stimulate the economy, then why do we have pensioners and seniors still living with high deeming and PLS [pension loan scheme] rates?” Mr Henschke said.

ANZ noted in its end of financial year 2019-2020 report that it had drawn down $13 billion under the Reserve Bank's low-cost Term Funding Facility (TFF) in the year to September.

The TFF allows banks to use low cost funding from the Reserve Bank, previously at an interest rate of 0.25% over three years, now at 0.10%. 


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author-avatar
Harrison is Savings.com.au's Assistant Editor. Prior to joining Savings in January 2020, he worked for some of Australia's largest comparison sites and media organisations. With a keen interest in the economy, housing policy, and personal finance, Harrison is passionate about breaking down complex financial topics for the everyday consumer.

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