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Westpac chief defends rate rise

Westpac chief executive Gail Kelly has defended the bank’s decision to increase interest rates by almost double that of the rate set down by the Reserve Bank, claiming that the rate decision was a consequence of higher funding costs.

Speaking publicly for the first time since the bank increased its standard variable home loan rate by 45 basis points, Kelly said it was a necessary move in the current climate.

”These are difficult decisions, we take an awful lot of time and a great deal of thought to make these decisions, but it was made against this backdrop of this new environment and we wanted to run a sustainable business,” she said.

She added that customers would not be hugely affected by the increase.

”No customers will lose their house as a result of this (rate decision),” she said.

Following last week’s rate rise, Westpac has emerged with the highest standard variable mortgage at 6.76 percent, closely followed by ANZ at 6.66 percent, and Commonwealth Bank on 6.61 percent. NAB lifted interest rates in line with the Reserve Bank to sit at 6.49 percent.

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Jessica Stanic

Jessica Stanic

Jessica has a background in both marketing and journalism and is dedicated to making the website the leading online resource for small to medium businesses with ambitions to grow.

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