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Commonwealth Bank lifts interest rates on deposits and loans

10 November 2006

The Commonwealth Bank today announced it will increase its rates on a range of deposit accounts, as well as increasing its variable home loan interest rates and business loan interest rates, reflecting recent increases in market rates.

Increases in deposit rates, home lending rates and variable rates on business loans are all effective Monday 13 November 2006, with selected business products having already passed on the rate rise effective 9 November.

The deposit rate on the Commonwealth Bank Cash Investment Account will increase by the full 25bp, with a top rate of 5.5% for balances above $250,000.

Owner occupied and investment home loan interest rates for new and existing customers will increase as follows:

 

 

Old Rate % pa

New Rate % pa

Change

Complete Home Loan Variable Rate

7.82

(7.94 Comparison Rate)*

8.07

(8.19 Comparison Rate)*

+0.25%

Economiser

(Base Variable Rate)

7.31

(7.44 Comparison Rate)*

7.56

(7.69 Comparison Rate)*

+0.25%

Viridian Line of Credit (Residential Equity Rate)

7.82

8.07

+0.25%

Variable rates on business loans will also increase by 0.25%.

The 0.25% interest rate increase means required repayments at the new standard variable rate of 8.07% pa on a principal and interest loan over 25 years rise by $16 per month per $100,000 of borrowings.

Executive General Manager, Lending Products, Geoff Austin said, "While market conditions have produced this interest rate increase and therefore increased required minimum repayments, the majority of Commonwealth Bank variable rate home loan borrowers have a buffer as they are already paying more than the required amount.

"Customers are encouraged to review their financial position and budgeting in light of this interest rate increase to ensure that their arrangements remain appropriate for their circumstances. Those customers who are seeking some assistance or financial advice should contact their branch or our home loan hotline on 13 22 24. We can discuss with them alternative arrangements, such as extending the loan term or perhaps switching to a fixed interest rate.

"To avoid the uncertainty of future variable rate movements, existing and new borrowers can lock in part or all of their loan to one of the Bank’s fixed rate home loans. Interest rates on our range of 1-5 year fixed rates are still currently below the Standard Variable Rate. " Mr Austin said.

Variable rates on business loans will also increase by 0.25% effective 13 November 2006 as follows:

 

Old Rate % pa

New Rate % pa

Change

BetterBusiness Loan Residential Equity Rate

7.82

8.07

+0.25%

BetterBusiness Loan Variable Base Rate

8.80

9.05

+0.25%

Overdraft Index Rate

10.20

10.45

+0.25%

The comparison rate is calculated based on $150,000 over 25 years for a secured loan.

WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

Note: Fees and charges may apply for changes to loan types and repayment options.

 

ENDS

Media contact:

Michael Gleeson
Marketing and Communications
Telephone: 9378 5965
Mobile: 0400096924

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