NAB Likely To Be First Lender To Raise Rates After Election

A research analyst with Macquarie Equities Research says he believes that Australian banking major National Australia Bank will be the first lender to raise its rates after the election.

According to The Australian, banks will likely raise their interest rates prior to the Federal election, but according to Macquarie’s Michael Wiblin, once the election is over, interest rates will be fair game.

“The sensitivity around mortgage repricing over the last six months is due to the [forthcoming] election,” Mr. Wiblin said.

Mr. Wiblin says he thinks that NAB would be the first of the four major lenders to raise its rates, because its current standard variable rate of 7.24 per cent was currently the lowest amongst the Big Four by 12 basis points

Wiblin predicted that the NAB might the first of the big four banks to lift rates because its 7.24 percent standard variable rate was the lowest of its major competitors by 12 basis points.

“We do not comment on speculation by others about interest rates. What we would do is ask people to consider our track record. NAB was the only bank not to lift its rates above the [Reserve Bank of Australia] move in December 2009.” an NAB spokeswoman was quoted by the Australian.

The Macquarie report also said that lenders felt quite justified in any decision to reprice their mortgages, in the wake of continuously rising funding costs, and expanding mortgage books.

“An ability to reprice mortgages is set to continue for at least another six weeks, given the election,” Wiblin told the Sydney Morning Herald.

“However the unintended consequences of this situation will only get worse, with no repricing and increasing funding costs.”

In June home owners were granted a break from rising mortgage payments after the RBA left interest rates on hold at 4.5 percent.

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