Sovereign Drops Floating Rate Below 8%

MEDIA RELEASE
8 March 2001

SOVEREIGN DROPS FLOATING RATE BELOW 8%
FURTHER REDUCTIONS PREDICTED

New Zealand’s largest non-bank home mortgage lender, Sovereign Financial Services today announced their floating home loan interest rate is to decrease below the 8% per annum threshold. Sovereign’s current floating interest rate of 8.30% pa will be reduced to 7.95% pa effective immediately for new borrowers and 14 March for existing borrowers.

This will make Sovereign’s rate 0.30% below the lowest of the five major trading banks. Sovereign Financial Services now offers one of the most competitive interest rates available.

In announcing the change Paul Bravo, Director of Sovereign Home Loans, said the good news for borrowers is that interest rates are likely to continue to decline.

“Wholesale interest rates in New Zealand have decreased steadily since the US Federal Reserve cut rates earlier this year, and it is widely expected that they will cut rates by a further 50 points this month. While Dr Brash appears to have been reluctant to reduce rates in New Zealand, I suspect he too will cut interest rates here in his March review.

“If the US economy does slow even further it will have an impact on interest rates here and I would not be surprised if our floating home loan rates drop below 7%,” Mr Bravo said.

Ends.

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