Out of frustration, I had sent this email to our Home finance Manager.
Nice guy. He was apologetic, but could not do anything as his hands are tied.
Hi Chris,
Good day!
As I dont have the names or email addresses of the smart guys in the Treasury department sitting in 275 Kent Street Sydney, so I am forced to write this email to you, unfortunately.
Our relationship goes a long way with 6 of my Investment property Loan accounts with Westpac. That is a majority of my small portfolio of Investments. We trusted your advise and the Westpac brand.
But unfortunatly the brand has let us down. And let us down by far.
The Interest rate hike of 45 bps against RBA's 25 bps is sheer corporate greed and pathetic negligence to the customer's feelings.
The folks at the Interest Rate Department of Westpac and their management need to realise business is about ethics, not just commerce.
I have worked in various banks for the last 15 years on the Treasury and Capital markets domain area. And I understand a thing or two about Interest rate settings and the cost of funds.
In 2008, when the Reserve bank (RBA) dropped its Interest rates in a hurry to fuel the stalling economy, Westpac passed only a portion. When your uninitiated customers asked "Why not pass the full rate cut?",
Westpac said that the cost of capital to fund the Loan book were too high as they were borrowing in both the Domestic Market and the International market. That is, though the Domestic Interest rates were falling, overseas Interest rates were still high, which is why they are unable to offer the same spread as RBA.
Fine, we bought that, and said yep Westpac must be dealing in more than just one Money market, afterall they are an International player.
And now in the last quarter of 2009, as the economy is picking up momentum and RBA wants to curtails the rising inflation it hikes its Cash rate by 25 bps to 3.75%. And what does Westpac do? Whack it's customers (read 'suckers') with a 45 bps hike to the Standard Variable Rate taking it effectively to 6.76%
Can I now ask "This time which International money market is Westpac borrowing from to fund the loan books? Timbuktoo I guess!"
Mate, either the guys in your swanky high rise office think their customers are dumb, or that they are outright greedy. I am guessing it is Bonus pay time!
By the way, did our dear Westpac ever care that the smaller lenders like RAMS, Aussie and Homeside were, on average, 22bps below for this entire year. This is the 'actual' difference for a borrower.
And now after this 45bps hike where do you think the competition stands?
As I am reeling with disgust on this issue, what was a double whammy was last night's press release from Head quarters.
Some honourable member of the Westpac mangement decides to talk on behalf of the customer and says "they will not be leaving Westpac".
Whoa, what a Hope! eternal optimist he must be!
Good luck and thanks for the Xmas present.
Cheers,
Nice guy. He was apologetic, but could not do anything as his hands are tied.
Hi Chris,
Good day!
As I dont have the names or email addresses of the smart guys in the Treasury department sitting in 275 Kent Street Sydney, so I am forced to write this email to you, unfortunately.
Our relationship goes a long way with 6 of my Investment property Loan accounts with Westpac. That is a majority of my small portfolio of Investments. We trusted your advise and the Westpac brand.
But unfortunatly the brand has let us down. And let us down by far.
The Interest rate hike of 45 bps against RBA's 25 bps is sheer corporate greed and pathetic negligence to the customer's feelings.
The folks at the Interest Rate Department of Westpac and their management need to realise business is about ethics, not just commerce.
I have worked in various banks for the last 15 years on the Treasury and Capital markets domain area. And I understand a thing or two about Interest rate settings and the cost of funds.
In 2008, when the Reserve bank (RBA) dropped its Interest rates in a hurry to fuel the stalling economy, Westpac passed only a portion. When your uninitiated customers asked "Why not pass the full rate cut?",
Westpac said that the cost of capital to fund the Loan book were too high as they were borrowing in both the Domestic Market and the International market. That is, though the Domestic Interest rates were falling, overseas Interest rates were still high, which is why they are unable to offer the same spread as RBA.
Fine, we bought that, and said yep Westpac must be dealing in more than just one Money market, afterall they are an International player.
And now in the last quarter of 2009, as the economy is picking up momentum and RBA wants to curtails the rising inflation it hikes its Cash rate by 25 bps to 3.75%. And what does Westpac do? Whack it's customers (read 'suckers') with a 45 bps hike to the Standard Variable Rate taking it effectively to 6.76%
Can I now ask "This time which International money market is Westpac borrowing from to fund the loan books? Timbuktoo I guess!"
Mate, either the guys in your swanky high rise office think their customers are dumb, or that they are outright greedy. I am guessing it is Bonus pay time!
By the way, did our dear Westpac ever care that the smaller lenders like RAMS, Aussie and Homeside were, on average, 22bps below for this entire year. This is the 'actual' difference for a borrower.
And now after this 45bps hike where do you think the competition stands?
As I am reeling with disgust on this issue, what was a double whammy was last night's press release from Head quarters.
Some honourable member of the Westpac mangement decides to talk on behalf of the customer and says "they will not be leaving Westpac".
Whoa, what a Hope! eternal optimist he must be!
Good luck and thanks for the Xmas present.
Cheers,
