Westpac Banking Corp. (>> Westpac Banking Corporation) subsidiary St. George Banking Group Friday passed on a bigger slice of this week's rate cut from the central bank to its customers than its parent.
From May 14, St. George will cut its standard variable home loan rate by 0.38% to 7.04% a year, the bank said in a statement. That's equivalent to reducing repayments on a A$250,000 mortgage by A$732 a year, the bank said.
Westpac, Australia's second-largest bank by market value, earlier said it will cut its standard variable mortgage rate by 37 basis points to 7.09%, joining its major peers Commonwealth Bank of Australia (>> Commonwealth Bank of Australia) and National Australia Bank Ltd. (>> National Australia Bank Ltd.) in passing on only part of the Reserve Bank of Australia's 50 basis-point rate cut.
"Since September 2011, St.George has cut its variable mortgage rate by 0.76%, equating to an annual saving of A$1,476 on an average home loan," said Chief Executive George Frazis in a statement.
On Friday, St. George reported a 7% drop in net-cash earnings in the first half of fiscal 2012 to A$569 million. Westpac reported a rise in its cash earnings in the first half of fiscal 2012 to a record A$3.12 billion this week, slightly above the consensus analyst forecast of A$3.11 billion.
-By Caroline Henshaw, Dow Jones Newswires; 61-2-8272-4689; firstname.lastname@example.org