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Westpac raises variable mortgage rate by 0.5 percent, in line with RBA’s rate hike

Westpac has led the way as the first major bank to pass on the full value of the Reserve Bank’s surprising rise in interest rates to mortgage borrowers.

Westpac said it would raise variable interest rates on home loans by half a percentage point from June 21.

The bank also said it would introduce a 2.25 percent 12-month term deposit rate for savers from June 9, while reviewing other deposit rates.

When the banks pass on the rate hike in full, the rate hike will add $133 per month to a $500,000 loan over 25 years, and $265 per month to a $1 million loan.

“We know that a change in interest rates affects every budget differently,” said Chris de Bruin, CEO of Westpac Consumer and Business Banking.

“Our customers have carefully managed their finances during the pandemic, with many putting more money aside in their savings and contra accounts.

“This means the majority of our customers are anticipating their mortgage payments and have a buffer available to help them manage a rate hike.”

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