PHOTO: Kaboompics.com
Despite the Reserve Bank’s latest move to ease financial pressure, the big banks are dragging their heels – again. Here’s what they don’t want you to know
📉 OCR CUT: What Just Happened?
The Reserve Bank of New Zealand (RBNZ) has just cut the Official Cash Rate (OCR) by 25 basis points (0.25%), thanks to stabilised inflation 📊 and a weakened global economy impacted by fresh U.S. trade tariffs. For Kiwis with mortgages, this is supposed to mean relief. 🏡💰
But instead of mortgage rates dropping immediately, homeowners are left waiting – often over a week – for banks to pass on the savings. 💸⏳
🎯 “Interest rates go up like a rocket 🚀 but come down like a feather 🪶” – a familiar frustration for NZ borrowers.
🏦 So Why Don’t Banks Act Fast?
Despite the OCR change being public knowledge, most major banks take between 7 and 13.5 days to update their mortgage rates. Here’s the breakdown:
🔹 ASB & BNZ: ~7.75 days
🔹 ANZ: ~8.4 days
🔹 Westpac: ~13 days
🔹 Kiwibank: ~13.5 days
Each bank has their own “process” 🧾 – but critics say it’s just stalling. Here’s what the banks are claiming:
🗣️ What the Banks Say (And Why Critics Aren’t Buying It)
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Kiwibank: Needs time to notify customers – around 2 weeks.
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ANZ: Has to balance rates for both borrowers and savers.
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ASB: Compliance processes take time, but efforts to speed up are in place.
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BNZ: Complex system changes are required.
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Westpac: Needs 3 business days for new customers, more for existing ones due to notification requirements.
💬 Banking Reform Coalition’s Kent Duston slams these explanations as “tissue-thin excuses” 😡
🧨 “It’s a myth that their systems can’t do it instantly. These banks make billions – are we seriously saying they can’t afford to upgrade their tech?” – Kent Duston
💬 “They Wrote the Rules – So Why Can’t They Change Them?”
Duston points out that banks wrote their own loan agreements, meaning any rule requiring notice before rate changes was self-imposed.
🏛️ “They’re in charge of their systems, contracts, and notifications – so the delays are entirely self-serving,” he argues.
👥 Kiwis Deserve Better
With the cost of living crisis still biting and mortgage repayments pushing households to the brink, many are demanding change. 📉🏠
Numerous studies into New Zealand’s banking competitiveness suggest that there’s enough evidence for the government to legislate faster rate reductions.
📣 “It’s time for banks to work for the people – not just their shareholders.”
📊 Where to From Here?
The Financial Markets Authority (FMA), now acting as a banking conduct watchdog, has told Parliament that cracking down on delays in rate changes is a top priority. Could we finally see regulation to force transparency and fairness?
Only time will tell… ⏱️
📍 TL;DR: Why This Matters
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💵 OCR was cut by 0.25% – mortgage relief should follow
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🏦 Banks are taking up to 13 days to act
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🔍 Critics call their excuses “mythical” and “self-serving”
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📣 Calls grow louder for government regulation