BNZ has raised its fixed home loan rates by up to 0.20%, becoming the latest lender to hike amid a surge in wholesale costs driven by the Middle East conflict.
The changes take effect today for both new and existing customers.
Across BNZ's standard fixed housing loans, the six-month rate rose 0.10% to 4.79%, the one-year climbed 0.20% to 4.99%, and the 18-month increased 0.20% to 5.29%.
The two-year, three-year and four-year rates all lifted to 5.45% - up 0.16%, 0.16% and 0.06% respectively. The five-year rate was unchanged at 5.49%.
Variable home loan rates had already moved for new and existing customers from July 29, with the standard variable rate now at 6.09% and TotalMoney, Mortgage One and Rapid Repay rates all at 6.19%.
The move follows similar decisions across the sector as ANZ raised its fixed rates yesterday, and Westpac lifted its one to three-year terms last week.
Both banks are pointing to a surge in wholesale interest rates amid renewed war in the Middle East.
Three big banks move to hike
ANZ, the country's largest bank, raised its fixed rates by up to 0.26% across terms of six months to three years, taking its one-year special rate to 4.99% yesterday.
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ANZ personal banking managing director Grant Knuckey said wholesale rates had "increased significantly in recent months amid uncertainty surrounding the conflict in the Middle East, making offshore funding more expensive".
"Banks get their funding for lending from a variety of sources, including borrowing from global wholesale markets," he said.
"When global uncertainty pushes up those funding costs, it puts upward pressure on lending interest rates, including home loans.
"Wholesale rates have increased significantly in recent months amid uncertainty surrounding the conflict in the Middle East, making offshore funding more expensive.
"We aim to balance the needs of both borrowers and depositors while ensuring our rates reflect funding costs across the market."
Westpac's earlier move lifted its one-year special rate by 0.20% to 4.99%, among other changes
Managing director of consumer bank and wealth Helen Ryder said "re-escalating tensions in the Middle East have once again driven up wholesale interest rates, causing bank funding costs to rise."
"Most wholesale interest rates are now over 0.30% higher than they were a month ago, so with today's changes we are passing on some of those higher costs but also absorbing some," she said in a media release last week.
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