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Date Published : Friday, March 07, 2008
The head of HSBC Australia has said it will follow in the footsteps of any bank major lender that elevates its standard variable mortgage interest rate above the central bank's base rate.
Stuart Davis said that HSBC has traditionally been more of a "price taker" than a "price maker". In January, the bank raised its variable mortgage interest rate by 15 basis points, in line with all the other big banks in Australia.
And he confirmed that the bank will act in accordance with the other big players if the Reserve Bank of Australia (RBA) decides to hike the official lending and borrowing rate again.
On Tuesday, the RBA pushed up rates for the fourth time since last August, raising official cash rates to a near 12-year high of 7.25 per cent.
"It just makes sense to align with the market and then in terms of any initiatives that we want to do, we'll do them by being aggressive at the front end, with some discounts," Mr Davis told the Australian Business.
Earlier this week, the National Australia Bank lifted its mortgage rate by 0.29 of a percentage point, four basis points above the RBA's increase. At the same time, Westpac announced an increase of 0.3 of a percentage point, taking its standard variable rate to 9.27 per cent.
Most economists in Australia believe the RBA will raise interest rates again in May as part of an effort to rein in inflation, according to the Age.
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