Sunrise host David Koch has savaged the big banks for passing on “piddling” interest rate rises for savings accounts and making an estimated $600 million a month by failing to pass on increases.
As the Reserve Bank prepares to hike interest rates again today, the Treasurer Jim Chalmers has confirmed he’s “disappointed” the banks have been slow to pass on the benefits to savers.
“What do you say to the big banks who are whacking up interest rates on loans as quickly as possible, but not passing those increases in interest rates to savers,’’ host David Koch asked.
“The average saving rate for the big four banks is a piddly 0.3 per cent for a bonus saver. The average is 1.25 percent. ING is paying 2.6 per cent. The banks are paying less than half that one of their competitors is doing.”
The Treasurer said it was an issue he was taking up directly with the big banks.
“I think it is really disappointing and I will have an opportunity to relay that myself to the banks through the course of today,’’ he said.
Dr Chalmers said it should be “a silver lining for savers because people deserve better interest rates.”
“What you just mentioned in your question is bang on, you can get better interest rates on savings and deposits, so I would encourage people if you are being let down by your bank to find a better deal if you can,’’ he said.
The Treasurer has urged the banks to “give their customers a fair go”.
CBA, NAB, Westpac and ANZ are accused of holding back from savers the full benefits from rapidly rising rates.
The Australian reports today that Morgan Stanley analyst Richard Wiles told clients that failing to pass on this year’s unexpectedly aggressive monetary policy tightening to depositors would provide a “material near-term margin tail wind for the major banks”.
A new analysis indicated they were earning an additional $600m a month from passing on to savers only a fraction of the 1.25 percentage points in rate hikes delivered since May.
The Treasurer said he expected interest rates would rise again today.
“I think the Reserve Bank has been pretty clear that people should brace for another interest rate rise today,’’ he said.
“It will get worse before it gets better, but it will get better.”
“This is a difficult day for Australians with a mortgage,’’ he told Nine’s Today show.
Inflation is forecast to come down to 5.5 per cent by the middle of next year and slowly reduce to around 3 per cent.
The Treasurer said that the interest rate rises would play a role in reducing inflation.
“We can weather the storm together, but there will be some heavy weather for the time being and on the other side of it.”
Originally published as Sunrise host David Koch slams big four banks for failing to pass on on interest rate rises for savings accounts
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