Business overdraft and base interest rate relief

Westpac NZ announces business overdraft and base interest rate relief
Friday 30 January 2009
Press Release: Westpac New Zealand

Westpac New Zealand has announced a 1% cut to its business overdraft and base business lending rates, in a move that will provide some relief to businesses as well as the rural sector.

The move follows the announcement yesterday of across the board cuts to the bank's home mortgage interest rates.

Westpac's Acting Chief Executive Bruce McLachlan said today that many business customers have benefitted significantly and directly already through borrowing tied to bank bill and swap rates. The 90-day rate has fallen from a high of around 9% to where we are today at under 4%. That means some businesses will have experienced close to a 5% reduction in their cost of borrowing in the past six months.

"We do know, however, that many small and medium-sized businesses also utilise significant overdraft facilities for their day to day cash flow so a reduction in business overdrafts rates will also be very welcome.

"The overdraft and base interest rate cuts will apply to business within the next two weeks, demonstrating further that Westpac recognises the role the bank has to play in helping our customers as well as the economy," Mr McLachlan said.

"We want to assure our customers, many of whom are businesses, that we are doing, and will continue to do, what we can to support them in the face of a difficult global and local environment. For the bank, that includes managing higher levels of risk in relation to our lending as well as higher relative funding costs as a result of worsening international money market conditions.

"Importantly, businesses should feel reassured that Westpac remains open for new lending, confident it can manage that lending prudently and in a way that can help support the economy back to growth," Mr McLachlan said.

ENDS

© Scoop Media