BNZ ups floating rate, advises customers to fix loans

By NZPA

Monday 20th September 2004

Bank of New Zealand today raised its variable home loan rate, and advised customers to fix their interest rates.

BNZ said today in a statement its floating rate has increased from 8.25% to 8.50%.

Andrew Whitechurch, Bank of New Zealand's general manager of business development and strategy, warned more hikes were on the cards.

"We're predicting further official cash rate rises by the Reserve Bank this year, with interest rates potentially getting as high as 9 percent. We advise customers to fix home loans in the current environment and are doing all that we can to hold the popular one and two-year terms as low as possible for customers," Whitechurch said.

BNZ also announced an increase of its six month fixed rate from 7.35% to 7.50%, but its one and two year fixed rates are unchanged.

Other major banks have also increased their variable rates by 25 basis points in the wake of the Reserve Bank increasing the official cash rate by 25 basis points to 6.25% on September 9.

Westpac raised its variable rate to 8.60%, while ASB and National Bank both moved to 8.50% and Kiwibank increased its floating rate to 8%.

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