ANZ passing on full rate cut
- Thread starter virgo
- Start date
At lunchtime today I was starting to wonder, "What happens the banks collectively decide to do nothing at all?"
It'd almost be worth missing out on a rate cut to watch Wayne & Penny suffer a collective stroke on national TV...
It seems to me that all of the banks want to retain some of the cut for themselves but they're all feeling sensitive about the shrinking pie they can get a slice of right now, so they don't want the negative publicity.
By coming out with a full cut today, the ANZ has essentially set themselves up as the heros of the day.
We all want our interest rates cut and to pay the 'greedy banks' as little as possible. They post massive profits (although the word massive is disputable if you understand the capital they have invested).
Unfortunately the Europe situation is making a lot of people very nervous. We probably are going into another GFC and if that occurs, I'd much rather live in a country where where the banks are profitable, than one where I save a few points in interest.
Mind you I will personally be benefiting from and enjoying the lower rates in the next few weeks.
It'd almost be worth missing out on a rate cut to watch Wayne & Penny suffer a collective stroke on national TV...
It seems to me that all of the banks want to retain some of the cut for themselves but they're all feeling sensitive about the shrinking pie they can get a slice of right now, so they don't want the negative publicity.
By coming out with a full cut today, the ANZ has essentially set themselves up as the heros of the day.
We all want our interest rates cut and to pay the 'greedy banks' as little as possible. They post massive profits (although the word massive is disputable if you understand the capital they have invested).
Unfortunately the Europe situation is making a lot of people very nervous. We probably are going into another GFC and if that occurs, I'd much rather live in a country where where the banks are profitable, than one where I save a few points in interest.
Mind you I will personally be benefiting from and enjoying the lower rates in the next few weeks.
The thing I find interesting is ANZ's move re the monthly rate announcement. ANZ is trying to once and for all remove in the public's eye the link between the cash rate and their mortgage rates.
I also suspect it is in direct response to their worries about being nabbed (no pun intended) for price signalling with the others.
If they do end up choping and changing all the time it will make it hard to compare.
I also suspect it is in direct response to their worries about being nabbed (no pun intended) for price signalling with the others.
If they do end up choping and changing all the time it will make it hard to compare.
Imagine 1) the negative publicity if ANZ come out and increase the rates independently of RBA and 2) potential loss of customers if the other banks does not follow.
CBA passing the full 25 basis point
http://www.theaustralian.com.au/bus...on-full-rate-cut/story-fn91wad8-1226217425780
Talk about peer pressure
http://www.theaustralian.com.au/bus...on-full-rate-cut/story-fn91wad8-1226217425780
Talk about peer pressure
Have business interest rates come down in the past two months?
Yes they do. But there's a lag effect because commercial bills are usually 90 days, paid in advance. So only with the next rollover do you see the reduced rates.
Since Westpac have cut, it's likely St George will follow. No guarantees though!
If I was in marketing for the banks I would be doing everything possible to distance myself from the RBA rate circus.
Regular rate reviews independent of the cash rate.. perhaps adjust up a few basis point now and then, down a few basis points now and then.. and every time the RBA jumps 25 BP being sure to match it point for point as quickly as possible! People would lose interest tracking everything that way.
Regular rate reviews independent of the cash rate.. perhaps adjust up a few basis point now and then, down a few basis points now and then.. and every time the RBA jumps 25 BP being sure to match it point for point as quickly as possible! People would lose interest tracking everything that way.
Let's see what happens when the RBA eventually increases IR's. Will the banks still sing the same tune?
Probably not
For some reason the rate cuts seems to be heavier than the increases, takes the bank a good 10 days or more to lift them up, pack them in boxes, ship them all over the country and transfer them to our bank accounts. CBA have an estimated Dec 19th delivery date for the latest rate cut, look forward to opening the package when it arrives 
Like what ANZ have done... Announced that they will "review" their IRs on the 2nd Friday of every month. This give them a) ample opportunity to see how the competition has reacted to any movement by the RBA, and b) move rates up, down, all the place irrespective of the results of the RBA meeting. They can move even if RBA hasn't. Smart.
Yet another reason not to go with ANZ.
