Banks passed every cent of this year’s two Official Cash Rate increases on to floating mortgage customers, but gave those same borrowers only about 70 percent of the cuts made in late 2025, according to a Newswire analysis of a year of Financial Markets Authority figures.
The Financial Markets Authority (FMA) said on Tuesday that it now had a full year of data from its OCR pass-through tracker. After each Reserve Bank review it asks eight banks what they charge on a standard floating-rate mortgage, what they pay on a standard on-call savings account, and when any change reaches new and existing customers. The banks are ANZ, ASB, BNZ, Kiwibank, SBS, Westpac, The Co-operative Bank and TSB, which together provide about 98 percent of New Zealand’s housing loans, the regulator said in its statement.
The latest update covers the Reserve Bank’s 25 basis point increase to 2.75 percent on 2 September. All eight banks lifted their floating rates by at least the full quarter point, and The Co-operative Bank by 0.35 points. On-call savings moved far less. ASB and SBS left their tracked accounts unchanged, ANZ added 0.05 points, Kiwibank, TSB and Westpac added 0.15, and The Co-operative Bank 0.20. BNZ does not offer an account that matches the FMA’s savings profile.
That gap between borrowers and savers has drawn most of the attention this week, including from RNZ, where Simplicity chief economist Shamubeel Eaqub called it a “sad state of affairs”. But the full twelve months of tables, added up bank by bank, show a second and less noticed pattern in mortgage rates themselves.
Between August and November 2025 the Reserve Bank cut the OCR three times, taking it down a full percentage point from 3.25 percent to 2.25 percent. Over those three reviews the eight banks lowered their floating rates by an average of 0.71 points. ANZ passed on 0.80 points, Kiwibank and Westpac 0.70, ASB and SBS 0.65, and BNZ and TSB 0.60. Only The Co-operative Bank came close to the full amount, at 0.96 points.
When the OCR went back up by half a point in July and September this year, every bank lifted its floating rate by the full 0.50 points, and The Co-operative Bank by 0.70. ANZ and Kiwibank had also each added 0.10 points to their floating rates early in 2026, while the OCR was on hold.
The result is that floating mortgage rates are back where they were before the Reserve Bank’s 50 basis point cut in October 2025, even though the OCR is now a quarter point lower than it was then. ANZ, ASB and Westpac are charging exactly what they did, BNZ, SBS and TSB are 0.05 points higher and Kiwibank is 0.10 points higher. The Co-operative Bank is 0.01 points lower. Infometrics acting managing director Gareth Kiernan made the same observation to RNZ, and the FMA’s tables bear it out.
| Bank | Floating rate before Oct 2025 cut | Floating rate now | On-call rate before Oct 2025 cut | On-call rate now |
|---|---|---|---|---|
| ANZ | 6.29% | 6.29% | 0.60% | 0.50% |
| ASB | 6.29% | 6.29% | 0.45% | 0.25% |
| BNZ | 6.29% | 6.34% | No matching product | No matching product |
| Kiwibank | 6.15% | 6.25% | 2.00% | 1.90% |
| SBS | 6.29% | 6.34% | 0.40% | 0.60% |
| The Co-operative Bank | 5.70% | 5.69% | 1.20% | 1.10% |
| TSB | 6.24% | 6.29% | 1.70% | 1.40% |
| Westpac | 6.39% | 6.39% | 0.30% | 0.35% |
Savers have fared differently. On-call rates fell by an average of 0.56 points across the three cuts and have since risen by an average of 0.27 points, a little over half of the OCR’s increase. TSB’s WebSaver went from 1.95 percent to 1.00 percent and now pays 1.40 percent. Kiwibank’s Online Call went from 2.25 percent to 1.25 percent and now pays 1.90 percent. SBS is the exception. Its iSave account stayed at 0.40 percent through all three cuts and now pays 0.60 percent.
Some of the smaller savings cuts reflect how little room was left. By October 2025 ASB’s Savings on Call paid 0.10 percent and Westpac’s Simple Saver 0.05 percent, so neither could fall much further in November. Both have risen since, ASB’s to 0.25 percent and Westpac’s to 0.35 percent.
In dollar terms the differences add up. A $10,000 balance left for a year in ASB’s tracked account at 0.25 percent would earn $25 in interest before tax, against $190 at Kiwibank’s 1.90 percent. On the other side of the ledger, every $100,000 on ANZ’s floating rate now costs about $500 a year more in interest than at the 5.79 percent it charged through the first half of 2026. The Co-operative Bank’s chief executive, Mark Wilkshire, told interest.co.nz in April that about a third of mortgage customers have some money on a floating rate, even though floating loans are a much smaller share of total bank lending.
Timing matters too. Most banks moved their rates for new floating customers within a week of the September review, though BNZ took 15 days. Existing customers can wait longer. Existing floating customers at ANZ and TSB pay the higher rate from 23 September, 21 days after the review, and at SBS from 8 October, 36 days after. That lag works in borrowers’ favour on the way up. ANZ passed each of its 2025 cuts on to existing floating customers within six days, but both of this year’s rises took 21 days to reach them. For savers, TSB’s September increase takes effect on 23 September, also 21 days after the review.
Banks are not required to follow the OCR. The FMA notes on its data page that lenders “use the level of the OCR as one of the factors when they determine interest rates offered to their customers”. In April the FMA’s director of deposit taking, insurance and advice, Michael Hewes, told interest.co.nz that “there is no legal obligation to pass on OCR changes and the FMA is not a pricing regulator, so cannot determine the rates that a bank must offer its consumers.” The regulator’s role is to make sure banks treat customers fairly under the Conduct of Financial Institutions regime, and its statement on Tuesday said “The aim is also to encourage banks to reflect on fair treatment for their customers and how their products align with customer’s requirements.”
Kiernan told RNZ, “The savings rates were less responsive on the way down, so I’d expect them to be less responsive on the way up as well, particularly when the OCR is still reasonably low.” He suggested weak demand for loans might be part of the reason, saying “because there’s not a lot of demand for borrowing at the moment due to the soft housing market, banks have a relatively good supply of deposit funds coming in”.
The FMA said it was now working on a clearer way to present the figures, so customers can more easily compare how and when each bank passes on rate changes. The next OCR review is on 28 October, and our OCR tracker has the announcement dates and the full rate history. Anyone carrying floating debt can test the effect of extra repayments in our mortgage payoff simulator.
Has your floating rate climbed faster than your savings rate this year? Tell us what your bank has done in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job 🙂
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