news.com.au July 04, 2008 12:00AM
BANK SA and St George home loan customers will have to pay an extra $10 a week in mortgage repayments after the banks lifted rates to 9.67 per cent.
St George, which owns Bank SA, said the move was due to higher funding costs.
The new rates - announced today by Bank SA parent St George - will be effective from Tuesday next week, and would add an extra $10 per week to an average loan of $250,000 over a 30-year loan term.
The bank, which is in merger talks with Westpac, said it has taken the decison after "very careful consideration''.
The move comes despite the Reserve Bank's decision earlier this week to hold rates at a 12-year high of 7.25 per cent.
"Even with this change, we will not be recovering all of our increased funding costs for this year,'' said, Les Matheson, group executive retail bank at St George Bank.
"We are very mindful of the impact of increased home loan rates on customers," he added.
The bank also said it would waive its switching fee for customers that wish to switch to a 3-year or 5-year fixed home loan rate of 9.45 per cent.
The move is likely to follow similar action by other major banks. Currently, ANZ's standard variable rate is 9.47 per cent, the Commonwealth Bank of Australia's rate is 9.44 per cent, Westpac's rate is 9.47 per cent and the National Australia Bank's rate is 9.46 per cent.