Banks promise to make up rate cuts

The big banks have all promised to make up the difference in Reserve Bank rate cuts and the lesser cuts they have passed on to their customers. The big five banks passed on 0.8 per cent of the Reserve bank's one per cent cut in official cash rates yesterday, keeping 0.2 per cent to deal with higher funding costs brought on by the global credit crunch. Commonwealth bank said its customers could expect bigger rate cuts and cuts to rates independent of RBA rate cuts in the future when credit markets normalise. ANZ and Westpac agreed they would deliver said it would deliver rate cuts to customers when credit markets made it possible.

Source: The Australian Financial Review