Trending Financial News 5 December

Citibank raises rates on homeloans

Citibank is facing a backlash from politicians and consumer groups after raising rates on homeloans. Citi is the first bank in more than six months to hike standard variable rate loans for owner occupiers, by 0.23 per cent to 3.19 per cent (comparison rate 3.57 per cent pa).

House of Representatives economics committee chair, Tim Wilson MP told Banking Day last night that Citibank would be asked to explain the rate rises.

“I look forward to asking about their approach at Citi’s next appearance before the Economics Committee.”

Citi shields existing borrowers from rate hikes

A Citi spokesperson said yesterday that existing borrowers would not be affected by rate rises announced yesterday. The spokesperson told Banking Day the bank was boosting rates for new borrowers across its range of mortgages, including fixed rate loans and most investment products.

“Citi is making this change to ensure we can prioritise existing applications, and improve our processing times while still offering a competitive rate,” the spokesperson said.

“Our previous rate was one of the most competitive in market, and launched in line with the peak Spring period.”

Citibank raises credit card rates

Citibank Australia has raised the purchase interest rate on the Citi Rewards Signature Visa credit card and the Citi Simplicity Visa credit card. Both card’s rates have gone up 0.5 per cent from 20.99 per cent pa to 21.49 per cent pa.

Citi has also bumped up the cash advance rates on the same cards by 0.5 per cent to 22.24 per cent.

Compare Citi credit card rates with other credit cards at InfoChoice.

Shares crash as economy stuck in slow lane

The Australian share market has lost 3.6 per cent of its value in two days of trading. The ASX is on track for its worst week in more than one year.

The treasurer Josh Frydenberg claimed that a slight rise in annualised GDP growth reported yesterday, from 1.6 per cent to 1.7 per cent, showed the economy was back on track. The ABS reported quarterly GDP growth at 0.4 per cent for September, down from 0.6 per cent in the June quarter.

Fewer borrowers need mortgage brokers

Mortgage brokers facilitated 54.9 per cent of all mortgages approved in the three months to 30 September 2019. That market share is down 4.2 per cent from the September quarter 2018.

Mortgage Finance Association CEO Mike Felton said competition between lenders is fierce at the moment.

“During the past quarter, anecdotal evidence suggests that credit policy eased somewhat and that lenders were competing more aggressively.”

The lowest mortgage rates in December 2019

The lowest variable mortgage interest rate in Australia, now listed on InfoChoice in December 2019, is 2.69 per cent pa from Reduce Home Loans (comparison rate 2.70 per cent pa).

The lowest fixed mortgage interest rate in Australia, now listed on InfoChoice in December 2019, is also 2.69 per cent pa from UBank.

“A standout in the fixed rate market is UBank’s 2.69% pa (comparison rate 3.19% pa) for three years,” said Vadim Taube, CEO of leading Australian financial comparison site

“There are 28 home loans with advertised fixed 5-year rates under 3% pa listed on InfoChoice,” said Vadim Taube.

Top term deposit rates in December 2019

Term deposit users need to be looking around and comparing rates from across the market to ensure they are staying ahead of inflation,” said Vadim Taube, CEO of InfoChoice.

In December 2019, InfoChoice’s top term deposit rates are from online banks. Judo Bank offers a limited range of mostly longer terms. Judo’s 12-month term deposits are currently paying 2.0 per cent pa. Judo is paying 2.50 per cent pa on five-year terms. UBank is paying up to 1.70 per cent pa on 6-month term deposits.

You can compare term deposits in December 2019 at InfoChoice.

Top savings account rates in December 2019

Savers need to compare their rate with others in the market to ensure they are staying ahead of inflation and getting a competitive deal.

“Some of the online accounts from neo banks have the most competitive rates in the market,” said Vadim Taube, CEO of InfoChoice.

UBank’s USaver and Ultra transaction accounts linked together pay a maximum bonus rate of up to 2.10 per cent pa including a high base rate of 1.04 per cent pa.

Suncorp’s High Interest Growth Saver Account is paying a maximum bonus rate of 1.95 per cent pa in December 2019.

Compare at-call savings accounts in December 2019 at InfoChoice.

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