Key Facts

  • Kiwibank is raising some of its interest rates, including a rate for a one-year loan that was previously the lowest on the market.
  • The one-year special rate will increase from 7.25% to 7.35%.
  • Six-month rate will see a rise as well, moving from 7.25% to 7.39%.
  • The bank’s two-year special rate stands at 7.05% for clients with a minimum of 20% equity.
  • Other major banks have one-year rates at either 7.35%, 7.39% or 7.45%.
  • The official cash rate is planned to be reviewed on November 29, with expectations that it will remain at 5.5%.
  • Following their latest financial reports, some banks reported higher year-on-year net interest margins.

Article Summary

Kiwibank is set to raise a number of its interest rates, including the one-year special, which was formerly the lowest in the market. As a result, the one-year special will increase from 7.25% to 7.35%, matching the rates of several other major banks.

In addition to the one-year special rate, Kiwibank is also increasing its six-month rate from 7.25% to 7.39%. On the other hand, they are maintaining a headline special rate of 7.05% for two years for customers who possess a minimum of 20% equity.

The official cash rate, currently at 5.5%, is expected to be unchanged following its upcoming review on November 29. The unexpected shift in Kiwibank’s rates comes amidst increased net interest margins in some banks, reportedly due to New Zealanders keeping their money in transaction or savings accounts which offer low to no interest even as the cost of loans rise.

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