Banks told to offer RBA ‘rate tracker’ home loans

The Australian Financial Review03-27

The big banks have raised concerns about tracker mortgages, arguing that when interest rates are rising, the tool could be a risk to bank profitability and to the stability of the financial system....

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href=https://www.afr.com/companies/financial-services/banks-told-to-offer-rba-rate-tracker-home-loans-20240327-p5ffmu><strong>The Australian Financial Review</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The big banks have raised concerns about tracker mortgages, arguing that when interest rates are rising, the tool could be a risk to bank profitability and to the stability of the financial system....</p>\n\n<a href=\"https://www.afr.com/companies/financial-services/banks-told-to-offer-rba-rate-tracker-home-loans-20240327-p5ffmu\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"XKO.AU","symbol_name":"标普/澳交所 300指数","start_time":0,"source_url":"https://www.afr.com/companies/financial-services/banks-told-to-offer-rba-rate-tracker-home-loans-20240327-p5ffmu","article_id":"2422848289","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2422848289","pubTimestamp":1711509600,"sourceInfo":{"source_id":"afr_stock","name":"The Australian Financial Review"},"weMediaInfo":null,"summary":"The big banks have raised concerns about tracker mortgages, arguing that when interest rates are rising, the tool could be a risk to bank profitability and to the stability of the financial system.Whe","collect":0,"end_time":0,"defaultTopTitle":"afr.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"XKO.AU":"标普/澳交所 300指数","XAO.AU":"标普/澳交所 普通股指数","BK4585":"ETF&股票定投概念","RMBS":"Rambus","XJO.AU":"标普/澳交所 200指数","BK4141":"半导体产品"},"translate_title":"银行被告知提供澳大利亚央行“利率跟踪”住房贷款","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"RMBS":1,"XAO.AU":0.9,"XJO.AU":0.9,"XKO.AU":0.9},"content_text":"The big banks have raised concerns about tracker mortgages, arguing that when interest rates are rising, the tool could be a risk to bank profitability and to the stability of the financial system.When banks’ wholesale funding costs are rising, separate from the RBA cash rate moves, they would be unable to reprice loans.The Australian Banking Association was contacted for an updated response.Canadian exampleDr Mulino’s bipartisan committee said the prudential regulator should provide an independent benchmark for variable interest rates for new and switching customers, and that this be published for use by mortgage brokers and financial advisers.It also recommended examining a government-backed home loan scheme via residential mortgage-backed securities (RMBS) as in Canada, which, similar to Australia, has a concentrated system of big banks.Advertisement“The Canadian government invests in some residential mortgage-backed securities (RMBS), which reduces the costs of accessing funding for all banks but disproportionately so for smaller banks,” the report said.“Through this public securitisation of mortgages, Canada has a ... smaller margin between the interest rate banks charge on loans versus the interest rate banks pay out to depositors.”Better deposit deals urgedThe committee also urged Treasury’s competition taskforce to increase consumer engagement with mortgages and deposit products.Ideas included testing a requirement for banks to notify the base deposit interest rate at the end of the introductory period, clearly notifying deposit holders of changes to interest rates, changes to eligibility bonus interest, and alerting customers when they are approaching a minimum balance level eligible for a bonus interest rate.The government was also advised to explore making expensive foreign exchange fees charged by financial institutions more transparent for customers.AdvertisementTo help smaller banks compete better against Commonwealth Bank, Westpac, National Australia Bank and ANZ, the report said the Australian Prudential Regulation Authority should examine loosening capital holding requirements for the mid-tier lenders.“The committee is troubled by the significant difference in profitabilitybetween the major banks and the smaller banks.”Westpac chief executive Peter King told The Australian Financial Review Banking Summit on Tuesday that smaller lenders would find it very difficult to compete in a digital world that requires large-scale investments.“I think scale wins,” Mr King said.More generally, in line with the government’s continuing review of merger laws, the committee agreed with the Australian Competition and Consumer Commission that takeover over a certain dollar threshold should be notified for clearance.It also backed government moves to crack down on non-compete clauses impeding workers switching to higher-paying and more productive jobs.Research from economists at the e61 Institute found that half of workers surveyed were subject to some post-employment restraint, including non-disclosure and no-poaching clauses, and 22 per cent were barred from working for competitors under non-compete clauses.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; 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