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BNZ looks to copy SuperBank

It seems at least one of the major banks is taking more than a little notice of the newest player to enter the crowded mortgage market Superbank.

Friday, August 13th 2004, 2:22AM

by Jenny Ruth

Superbank launched its home loans offer in mid-July with a key element being its built-in reward system for existing customers, progressively lowering the interest rate the longer the customer stays with it.

The rate on a $210,000 home loan taken out at 7.5% would decline to 6.9% (assuming no other changes in the market) over 20 years, saving the borrower $10,000 over the life of a 25-year loan, Superbank says.

Bank of New Zealand is currently surveying its customers on their views of various different loans with a range of rewards for loyalty including varying numbers of Flybuys or AirPoints for each $1,000 borrowed and varying levels of lump sum payments up to $500 for re-fixing their fixed rate loan when the term expires.

But the bank is also asking customers’ views on reducing interest rates for each year the loan is held of varying amounts up to 0.2 percentage points a year and up to maximum 0.6 percentage points.

The bank is also testing whether customers would regard such rewards as fair compensation for a higher interest rate or whether they would still want a lower interest rate.

Finally, BNZ asks customers to rank aspects of a loan that are most important to them among:

  • Repay my mortgage faster
  • Pay less interest over the length of my mortgage
  • Receive a cash payment when setting up a home loan
  • Have the flexibility to repay more off the loan when I can afford it
  • Have a reduced interest rate.
After viewing BNZ’s questionaire, Superbank’s chief operating officer James Munro says it’s "obvious" that the questions were prompted by his bank’s home loan offer.

"Imitation is the ultimate form of flattery," Munro says.

Superbank spent months researching the market before finalising its home loan offer and the idea of discounts for loyalty "was an absolutely red hot driver, particularly for those with existing mortgages," he says.

"There’s this under-current out there that we detected that, once you’re in, the bank does very little to cement the relationship. We view it (the interest rate discount) as an absolute innovation in the market place."

BNZ has been in business for 143 years but is only now investigating the idea.

Should BNZ decide to follow suit, Munro hopes "that it’s customers will realise that they have Superbank to thank for it."

« Mortgage Choice lists in AustraliaBNZ says survey nothing to do with Superbank »

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA - Back My Build 5.44 - - -
AIA - Go Home Loans 7.99 5.99 5.69 5.69
ANZ 7.89 6.59 6.29 6.29
ANZ Blueprint to Build 7.39 - - -
ANZ Good Energy - - - 1.00
ANZ Special - 5.99 5.69 5.69
ASB Bank 7.89 5.99 5.69 5.69
ASB Better Homes Top Up - - - 1.00
Avanti Finance 8.40 - - -
Basecorp Finance 9.60 - - -
BNZ - Classic - 5.99 5.69 5.69
Lender Flt 1yr 2yr 3yr
BNZ - Mortgage One 7.94 - - -
BNZ - Rapid Repay 7.94 - - -
BNZ - Std 7.94 5.99 5.69 5.69
BNZ - TotalMoney 7.94 - - -
CFML 321 Loans 6.20 - - -
CFML Home Loans 6.45 - - -
CFML Prime Loans 8.25 - - -
CFML Standard Loans 9.20 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - 5.79 - -
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Owner Occ 7.65 5.99 5.75 5.69
Co-operative Bank - Standard 7.65 6.49 6.25 6.19
Credit Union Auckland 7.70 - - -
First Credit Union Special - 6.40 6.10 -
First Credit Union Standard 8.50 7.00 6.70 -
Heartland Bank - Online 7.49 ▼5.65 ▼5.55 ▼5.55
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.00 6.50 -
ICBC 7.49 5.99 5.65 5.59
Kainga Ora 8.39 7.05 6.59 6.49
Kainga Ora - First Home Buyer Special - - - -
Lender Flt 1yr 2yr 3yr
Kiwibank 7.75 6.89 6.59 6.49
Kiwibank - Offset 8.25 - - -
Kiwibank Special 7.75 5.99 5.69 5.69
Liberty 8.59 8.69 8.79 8.94
Nelson Building Society 8.44 ▼6.39 ▼6.09 -
Pepper Money Advantage 10.49 - - -
Pepper Money Easy 8.69 - - -
Pepper Money Essential 8.29 - - -
SBS Bank 7.99 6.95 6.29 6.29
SBS Bank Special - ▼6.15 5.69 5.69
SBS Construction lending for FHB - - - -
Lender Flt 1yr 2yr 3yr
SBS FirstHome Combo 5.44 ▼5.15 - -
SBS FirstHome Combo - - - -
SBS Unwind reverse equity 9.75 - - -
TSB Bank 8.69 6.79 6.49 6.49
TSB Special 7.89 5.99 5.69 5.69
Unity ▼7.64 5.99 5.69 -
Unity First Home Buyer special - 5.49 - -
Wairarapa Building Society 8.50 ▼6.19 ▼5.79 -
Westpac 8.39 6.89 6.39 6.39
Westpac Choices Everyday 8.49 - - -
Westpac Offset 8.39 - - -
Lender Flt 1yr 2yr 3yr
Westpac Special - 6.29 5.79 5.79
Median 7.99 6.17 5.79 5.69

Last updated: 30 October 2024 9:36am

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