CBA rewards savers as the bank announces its RBA response

Australia’s biggest bank, CBA, has followed NAB, by announcing it will pass on yesterday’s 0.25 percentage point RBA hike in full to its variable mortgage customers.

Unlike NAB, CBA has also revealed what it will do for its savings customers, announcing rate hikes for each of its key savings accounts, in most cases by more than the 0.25 percentage point hike.

CBA variable rate changes for owner-occupiers – effective 11 November

Source: RateCity.com.au. Repayments are for an owner-occupier paying principal and interest with a $500,000 loan over 25 years. An LVR of 70% applies to CBA’s lowest variable rate.

CBA savings rate changes – effective 11 November

Source: RateCity.com.au. Note: conditions and balance caps apply for maximum rate on select accounts.

CBA has also announced two new term deposit rates at 3.75 per cent for 12-months and 4.00 per cent for 18-months. While these are significant boosts to the banks’ current rates, they are by no means the highest.

Analysis of the RateCity.com.au database shows there are currently nine banks offering at least one term deposit over 4 per cent for up to 2 years.

RateCity.com.au research director, Sally Tindall, said: “For three months in a row, CBA has announced hikes to some of its key savings accounts that go above and beyond what the RBA has prescribed.”

“The bank has clearly had a change of heart when it comes to passing on rate hikes to its savers. After a very slow start at the beginning of the hikes, CBA is now serving up decent increases to the majority of its savings customers, which is fantastic to see,” she said.

“CBA’s existing NetBank customers will be getting a quarter of a percentage point hike, taking the ongoing rate to 1.35 per cent, however, new customers will be offered a rate two-and-a-half times this to tempt them in the door.

“NetBank savers might have seen their rate finally rise off the floor, but at 1.35 per cent, it’s still well below the market leaders. Customers looking for decent returns on their cash can get a rate three times higher than this if they’re willing to jump through a few hoops.

“CBA’s announcement will put pressure on the other three big banks and the market leaders to put decent increases on the table for savers. Let’s hope the others play ball,” she said. 

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