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The National Australia Bank (NAB) confirmed that its standard variable home loan interest rate would increase by 0.43% per annum, effective on November 15, 2010. NAB also announced that it would abolish Early Exit Fees on new and existing NAB home loans which would take effect on December 06, 2010.
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Lisa Gray, Group Executive NAB Personal Banking, said, "For 17 months NAB has delivered its customers the lowest standard variable home loan interest rate of the major banks and today's announcement means we will continue to offer a highly competitive rate.
"NAB is committed to continuing to offer fairer value banking to our customers. Offering a highly competitive standard variable home loan rate as well as some of the best deals on bank fees is an important part of this.
NAB was the first Australian bank to abolish overdrawn and monthly account service fees on personal transaction accounts. However, the bank said today that it is not sustainable for them to keep on absorbing the extra cost.
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The changes introduce a competitive standard variable home loan interest rate for NAB customers. On an average $300,000 loan, the interest rate will continue to deliver savings of at least $32 a month according to a comparison by NAB to other major banks who have recently announced changes to their interest rates.
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NAB has a 7.67% standard variable rate, as compared to ANZ's 7.80% and CBA's 7.81%. Westpac and St George has not yet made an annoucement on their standard variable rate. NAB said it will continue to absorb a significant portion of its increased average funding costs.
Ms. Gray said: "NAB has been a strong supporter of measures to encourage even more transparency and competition in the home loan market."
"We believe these measures will benefit customers and also those lenders, like the NAB, who have been willing to offer the most competitive interest rates."
NAB will also increase a range of deposit interest rates by between 0.25% and up to 1.00%.
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