The ACCC has come down hard on the big banks. More information is below but
1. investigations show only new customers are been given discounts, legacy customers were not
2. Non-big 4 are pricing to compete, whereas the larger banks are pricing to stablize
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Here is the summary from: Australian Competition and Consumer Commission (ACCC)
💬 chairman Rod Sims stated the nation’s big banks do not provide their customers with healthy competition.
💬 Further, he stated: ANZ, Commonwealth, NAB, Westpac and Macquarie resembles ‘synchronised swimming’ not vigorous competition.”
💬 The big four banks represent approximately 80% of all outstanding residential mortgages held by banks in Australia
💬 The lion’s share of home loan discounts from the big four banks were found to be being offered to new customers rather than existing customers, with data from 2015 to 2017 showing that existing borrowers on standard variable interest rate residential mortgages were paying interest rates up to 32 basis points higher (on average) than new borrowers – a saving of approximately $1200 in interest over the first year of a $375,000 mortgage.
💬 Australians may be able to get a better deal by switching lenders
The ACCC’s final report into residential mortgages is due to be released 30 June 2018.