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Savers get a big boost as Westpac announces RBA response
Westpac has today confirmed it is passing on the 0.25 percentage point hike to its variable mortgages, however, it has upped the ante by announcing it will increase some savings rates by more than triple this.
Westpac will increase the ongoing rate on its Life account by 0.90 percentage points to 3.50 per cent, for new and existing savings customers.
Currently there are just seven banks offering a rate higher than 3.50 per cent for all adults, however, this may change as more banks apply their own hikes.
The bank will also lift the bonus rate on its eSaver account by 0.95 percentage points to 3.50 per cent, but existing eSaver customers will miss out on the rate hike.
Westpac savings changes – effective 9 November
| Old max rate | New max rate | Change | |
| Life | 2.60% | 3.50% | +0.90% |
| eSaver | 2.55% for 5mths then 0.85% | 3.50% for 5mths then 0.85% | +0.95% for 5mths
no change to ongoing rate |
| Bump (ages under 18) | 2.65% | 3.50% | +0.85% |
| Spend&Save (ages 18-29) | 3.75% | 4.00% | +0.25% |
Source: RateCity.com.au. Note: conditions and balance caps apply for maximum rate on select accounts.
What is Westpac doing for variable mortgages?
Westpac has also announced it is passing on the full 0.25 percentage point RBA hike to variable mortgages, effective 15 November.
Westpac variable rates for owner-occupiers – effective 15 November
| Old rate | New rate | Increase in repayments, $500K | |
| Lowest variable | 4.24% for 2yrs then 4.64% | 4.49% for 2yrs then 4.89% | $70 |
| Discounted variable rate | 5.69% | 5.94% | $76 |
| Standard variable rate | 6.98% | 7.23% | $80 |
Source: RateCity.com.au. Repayments are for an owner-occupier paying principal and interest with a $500,000 loan over 25 years.
RateCity.com.au research director, Sally Tindall, said: “Westpac has thrown down the gauntlet to its big bank competitors by upping the ongoing rate on its popular Life account to an impressive 3.50 per cent.”
“It’s refreshing to see a big bank reward its existing savers by boosting an ongoing savings rate by 0.90 percentage points – that’s almost four times what the RBA has prescribed,” she said.
“Westpac Life customers are finally about to find out what a competitive interest rate can do to their hard-earned cash.
“This rate from Westpac will help fuel competition in the savings sector. Not only will it win new business for the bank, it will also help retain existing customers who might have been getting itchy feet.
“Westpac Spend&Save customers will also see their rate increase to a highly-competitive 4 per cent for Australians aged 18 to 29,” she said.
Disclaimer
This article is over two years old, last updated on November 2, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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