Banks have outlined how they are supporting those affected by the coronavirus pandemic and its economic impacts.
All members of the Australian Banking Association (ABA) will suspend principal and interest loan repayments for distressed small-business customers for six months.
All four major banks (CBA, NAB, ANZ and Westpac) will also extend this to distressed home loan customers, enabling them to defer repayments for up to six months.
The big four banks also announced other measures for personal and business customers, which are outlined here:
- CBA has not reduced variable home loan rates.
- 1, 2 and 3-year fixed owner-occupied principal and interest loans will be reduced to 2.29% for both new and existing customers.
- Repayments will be automatically reduced for all variable P&I home loan accounts (to the minimum required within the borrower’s loan contract).
- For business customers, CBA will auto-enrol 76,000 businesses into loan deferral arrangements for up to six months; reduce rates on business loans, participate in the RBA’s new term funding facility aimed at providing low-cost credit to businesses.
- For depositors, CBA will increase 12-month term deposit rates to 1.70% for new and existing CBA personal customers on balances from $5,000 to $2 million; and increase eligibility criteria for personal overdrafts.
- ANZ is the only major bank to announce reductions to its variable home loan rates, reducing rates across all products by 0.15%.
- The bank will also introduce a two-year fixed rate of 2.19% for owner-occupiers paying principal and interest.
- For business customers, ANZ will decrease variable interest small business loan rates by 0.25%, provide temporary increases in overdraft facilities for 12 months; and reduce new two and three-year fixed rates for secured SME loans of up to $1 million to 2.59%.
- NAB has not reduced variable home loan rates.
- Interest rates on new loans and all overdrafts on QuickBiz will be cut by 2%
- Variable rates on small business loans will be reduced by 1%
- 10-month term deposit rate of 1.75% for depositors.
- Overdrafts reduced by 2% for new and existing customers.
- Variable interest rates on small-business cash-based loans will reduce by 1%.
- A 2.29% fixed rate home loan will be introduced for 1, 2 and 3-year owner-occupied customers on P&I repayments with a Premier Advantage Package.
- A 12-month term deposit of 1.7% will be introduced. This will rise to 2 per cent over eight months for Australians aged 65 years and over (up to $500,000 per customer).
- In addition, Westpac announced a $10-billion home-lending fund to assist more Australians into home ownership.
Smaller lenders have also introduced a range of measures to support their customers. Please contact me directly for more information.
First Port of Call
If you are experiencing difficulty meeting your loan repayments, please contact me, and I can liaise with the banks on your behalf. If you have any concerns about your personal or business finances call me on (02) 9908 9888 or email email@example.com.
Patricia Williams is a credited representative (CRN 400458) of BLSSA Pty Ltd (Australian Credit License No. 391237).