CBA adds to the shift in home loan trends, following on from Westpac earlier in the week, Macquarie last week, and NAB in July.
Many smaller lenders this week also made changes to fixed rates.
However Australia's largest bank, a week after posting some big profits - CEO Matt Comyn is pictured above presenting the figures - has gone one further and cut rates on some variable products.
Wholesale benchmark rates have taken a tumble recently, including swap rates and Treasury bond yields, which are big drivers of the direction of fixed rates.
On the product side, term deposit rates from many institutions have come tumbling down in a bloodbath couple of weeks - including from CBA - indicating that many banks are bullish on the RBA and Michele Bullock delivering some rate cuts before long.
The term deposit cuts could also be used as a hedge against a reignition of the home loan rate war that saw net interest margins plunge during Covid and in the early days of the RBA's tightening cycle.
CBA's variable rate changes signify a re-entry into home loan competition from the big bank, like a debutante revealing herself at the ball.
In its 2024 results it was explicit in its motivation to originate more loans directly, rather than through brokers.
Nearly two thirds (65%) of its home loans written from January through June 2024 were through its proprietarychannel (i.e. direct) rather than brokers; just 28% is the figure for competitors according to CBA.
Still, however, CBA's home loans as seen below are up to a full percentage point higher than the lowest in the market.
Fixed rates were slashed by up to 70 basis points, but you're probably not here for that; here are the details on CBA's variable product changes:
CBA's variable-rate home loan cuts
| Product Details | Advertised Rate % p.a. (Change) | Comparison Rate p.a.* |
|---|---|---|
| OO Extra P&I 60% | 6.44% (-0.15) | 6.45% |
| OO Extra P&I 70% | 6.49% (-0.20) | 6.50% |
| OO Extra P&I 80% | 6.59% (-0.20) | 6.60% |
| OO Extra P&I 90% | 6.89% (-0.25) | 6.90% |
| Inv Extra P&I 60% | 6.64% (-0.06) | 6.65% |
| Inv Extra P&I 70% | 6.69% (-0.06) | 6.70% |
| Inv Extra P&I 80% | 6.79% (-0.10) | 6.80% |
| Inv Extra P&I 90% | 7.29% (-0.35) | 7.31% |
These rates are likely for new customers only - existing customers might not get the benefit.
Packaged loans also saw rate cuts, which offer to bundle in a variety of products such as credit cards and other perks for an annual fee.
There is nary an advertised rate below 6%, except on three-year fixed loans for owner occupiers.
It's likely however that this isn't the end of the road for negotiation - especially for packaged rate customers - with discounts likely on offer if you fancy your skills.
Its new 'Digi Home Loan', however, is offered to owner occupiers at more than 40 basis points lower than the lowest seen above. Its digital offshoot Unloan also offers home loans under the 6% threshold.
Head image: CBA CEO Matt Comyn at the bank's 2024 results presentation. Image supplied.
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