Mutuals highly competitive on home loans
12 June 2009
The Commonwealth Bank’s decision to increase its home loan rate by 10 basis points to 5.74% highlights the need for a competitive home loan market.
“As other lenders have departed the market or been taken over by the major banks, credit unions and building societies continue to offer home loan rates well below those of the major banks,” said Abacus – Australian Mutuals CEO Louise Petschler.
“According to Cannex data today, the average home loan rate offered by building societies is 39 basis points below the average rate of the major banks. The average home loan rate offered by credit unions is 17 basis points below the average rate of the major banks,” Petschler said.
“Some credit unions and building societies are offering home loan rates below 5%.
“Credit unions and mutual building societies are subject to exactly the same regulatory framework as banks but, unlike banks, they are not driven to maximise profits for shareholders.
“This is because credit unions and mutual building societies are owned by their customers. They don’t have the constant tension of trying to please shareholders by squeezing customers.
“It’s why credit unions and mutual building societies strongly and consistently outperform the major banks in customer satisfaction surveys,” Petschler said.
For more information, contact:
Louise Petschler
Chief Executive Officer
02 8299 9034, 0408 239 226
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Mark Degotardi
Head of Public Affairs
02 8299 9053, 0419 998 201
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