Australia’s leading home lender Suncorp (ASX: SUN) takes the Westpac road by announcing second rise in last six months. The announcement reads that Suncorp will increase all variable home loans rates by 0.17% p.a. and small business loans rates by 0.10% p.a. from 14 September 2018.
This move comes after Westpac’s decision of change in variable rates which fired 0.14%p.a. of hike in variable mortgage rates. Westpac may have been the first one to throw out-of-cycle rate increase on public, but it is surely not the last one as all big lenders are joining the rates hike procession.
Suncorp Banking & Wealth CEO David Carter blamed increased funding cost for charging more from its customers. Mr. Carter added that they have acknowledged the continuous rise in Bank Bill Swap Rate (BBSW) which has benefited customers who have their money in savings accounts, with Suncorp’s term deposit rates up over 0.20% on average.
The company said the gap between cash rate and BBSW is likely to remain elevated for longer than the previous prediction as no movement has been expected in RBA’s cash rate until 2019.
However, commercial and agribusiness customers remained unaffected by this change as they are experiencing the impact of rising wholesale rates, having linked to Bank Bill Swap rates.
Suncorp share price edged up by 0.065% to $15.490 on 31 August 2018.
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