NZ Mortgage and deposit rates - retail banks and their margins

Kiwibank (Govt.) -
Term: 120 days @ 6.5% | Home: floating: 7.45%, fixed: 1y 6.49%, 5yr 7.7%
ASB -
Term: 150 days @ 6.5% | Home: floating @ 8.7%, fixed: 1y 7.4%, 5yr 8.25%
BNZ -
Term: 60 days @ 6.25% | Home: floating: 8.29%-8.99%, fixed: 1y 7.29%, 5yr 7.85%
ANZ -
Term: 120days @ 6.5% | Home: floating: 8.7%, fixed: 1y 7.3% , 5y 8.2%
National (ANZ) -
Term: 100days @ 6.5% | Home: floating: 8.7%, fixed: 1y 7.3%, 5y 8.2%
Westpac -
Term: 95 days @ 6.5% | Home: floating: 8.7%, fixed: 1y 7.3%, 5y 7.85%
TSB -
Term: 120 days @ 6.75% | Home: floating: 8.7%, fixed: 1y 7.29%, 4y 7.85%
SBS -
Term: 6.75% | Home: floating: 9.15%, fixed: 1y 7.3%

That was the situation late last night on the retail bank websites - the day the RBNZ Governor cut a record 1.5%. The Official Cash Rate went from 6.5% to 5%. Let us see whether the banks take Bollard's words seriously and pass on the Reserve Bank rate cut to the active members of the economy.

As a very crude measure of the margins for the banks - if we take the term deposit rate as the rate at which they borrow, and take the 1 year fixed home loan as the rate at which they lend (as an indication) we get the following results:

BNZ 1.04%
ASB 0.9%
Westpac 0.8%
National 0.8%
ANZ 0.8%
SBS 0.55%
TSB 0.54%
Kiwibank -0.01%

No surprises that the bank with no profit motive has the smallest margin (a negative in this case). I hope that kiwibank has had an effect on the other retail banks - to make them more "customer-friendly," but I doubt it. ATM fees are set to be hiked up, and the banks seem to find an excuse to ping everyone for doing - or not doing - anything, and possibly everything, or nothing - depending on which option will make the most money.

The Reserve Bank Governor sounded chipper about growth coming on next year (certainly on the Checkpoint programme he was very upbeat) - so is NZIER, but I doubt all this. I doubt the forecasts of such a quick recovery because this report is the first bit of good news in the meltdown - and it is a forecast at odds with everyone else. Oh if it were true. The European Central Bank Governor was just on TV and he sounded very sombre.