7 Sep 2009

Kiwibank surprised by ASB mortgage rate cut

3:11 pm on 7 September 2009

Kiwibank, which has had the lowest variable home loan rate for more than seven years, admits it was taken by surprise by ASB's mortgage rate cut on Friday.

On Friday, ASB reduced its variable mortgage rate by 0.65% to a more than 40-year low of 5.75%. The rate is 0.04% lower than Kiwibank.

Kiwibank appears likely to to wait until the next Reserve Bank announcement on the Official Cash Rate, on Thursday, before deciding on any response.

Most economists expect the bank to keep the cash rate on hold at 2.5%.