G&C has undertaken a comprehensive review of rates charged on our variable rate loan and savings/deposit products. With the RBA Cash Rate and overall market rates now falling to a further historic low, our priority at G&C has been to implement equitable rate changes that strike a fair balance between the competing needs of our borrowing and depositing members.
Although the extreme low rate environment is great news for home borrowers, we are very mindful of the fact that the vast majority of G&C members (around 90%) do not have a home loan. Many of our saving/depositing members are in retirement or semi-retirement and continue to suffer reduced income due to the impact of falling interest rates.
In order to accommodate these competing member interests, G&C will be reducing the rates on all variable rate home loans while also maintaining competitive (and in some cases above market) rates on our most popular savings and deposit products.
Home Loan Rate Changes
The rates on all G&C variable rate home loans (for both new and existing borrowers) will be reduced by between 0.10%p.a. - 0.40%p.a., depending on the particular product type. The Standard Variable Rate for home loan Investors (both interest-only and principal & interest product types) will be reduced by 0.40%p.a., while the Standard Variable Rate for Owner-Occupied borrowers (both interest-only and principal & interest product types) will be reduced by 0.25%p.a. The rate on our Retirees Access (Reverse Mortgage) product has also been reduced by 0.40%p.a., which follows the earlier 0.24%p.a. rate reduction on that product announced by G&C just prior to the recent RBA decision. Similarly, the rates on our Fixed Rate Home Loans have been reduced by up to 0.90%p.a. in the last 3 months.
Details of the rate reductions applied to our entire suite of home loan products can be found on our Rates & Fees page, but in summary, the rates on all other products not mentioned above will be reduced by between 0.10%p.a. - 0.25%p.a. The new interest rates will take effect on 30 June 2019 for existing loans and be available from 17 June 2019 for new loan applications, with fundings to occur on or after 30 June 2019.
In addition to the above home loan rate reductions, G&C took a decision prior to the RBA announcement to reduce the purchase rate on our Low Rate Visa card by 2.00%p.a. to a “best-in-market” rate of 7.49%p.a.
Savings/Deposit Rate Changes
G&C’s new savings and term deposit rates can be viewed on our Rates & Fees page. Although it has been necessary to lower the rates on most G&C deposit products in order to cover the cost of the loan rate reductions, at 2.50%p.a. the upper tier rate on our popular Pension Plus Savings Account remains much higher than similar products available from other banks.
The upper tier rate of 2.50%p.a. on G&C’s Inet Saver Product is unchanged and we have introduced a new 4 month term deposit special at 2.35%p.a.
While we fully recognise that the low rate environment poses challenges for our retired and semi-retired members, we will continue to look for opportunities to release “special” term deposit rates (such as our recently closed 3.10%p.a. special rate for 2 year term deposits which received an overwhelming response from G&C members).
The new rates on G&C’s savings and term deposit products will take effect on 17 June 2019.
Existing members will be advised of their new rates in their June member statement. If you require any further information about the impact of the above rate reductions, please refer to our website or contact us.