Hon Jim Anderton

Member of Parliament for Wigram
Progressive Leader

7 July 2009 Media Statement

Why do Aussie banks charge us more than they charge Australians?

Interest rates charged by the big Australian banks are not only higher than the rates charged by New Zealand’s own bank - they’re higher than the rates the Aussies charge themselves, Progressive Wigram MP Jim Anderton says.

“Floating interest rates on mortgages are far too high. But interest rates on credit cards, unsecured lending and farm lending are simply scandalous.

“For example, interest on a standard Westpac credit card is 19.45%. In Australia, the comparable interest rate charged on a standard Westpac card is 17.74%. Australia has a higher official cash rate than we do. Kiwibank is able to charge 12.9% on its standard credit cards.

“The rate for borrowing cash on a credit card in New Zealand is 22.45%, while the same bank charges 19.99% in Australia.

“Why do Aussie banks charge us more than they charge Australians?

“Everywhere you look, the Australian banks are charging too much for lending in New Zealand.

“Total farm debt at the moment is around $43 billion. At farm lending rates of 13-14%, that means our farmers are having to pay $5.5-6 billion a year in interest alone to the Australian banks.

“The Australian banks charge interest on unsecured loans of 17.95%, compared to 16.9% charged by Kiwibank.

“New Zealanders sent $11.7 billion in profit and interest payments to Australian-owned banks last year. That’s more than the entire sum collected in GST revenue. There is no reason why interest rates can’t come down. The Australian banks are rapacious.

“This picture of excessive interest charges more than justifies a parliamentary select committee enquiry and one can only guess why the National government is opposed to one taking place,” Jim Anderton said.

ENDS

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