Virgin Money still yet to pass on Feb rate cut to customers

ANALYSIS

One bank played the role of villain in February, when it refused to pass on much-needed rate relief to customers. Now it seems Virgin Money is set to double down in the face of a May rate cut by the RBA.

Failure to pass on all, or any of a 25 basis point cut by the central bank will leave Virgin Money and BOQS customers forking out 0.5 per cent more money in interest to their bank than they would be if those banks followed the lead of most of the 110 other lenders on comparison website Finder’s books and passed on the savings in full.

On an average Aussie loan of just above $600,000, a single rate cut of 0.25 per cent will save about $1200 a year. A double rate cut will save $2400 a year.

Those savings increase significantly for the vast number of Aussies with higher mortgage balances than the average.

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Back in February, media representatives from Bank of Queensland, which owns Virgin Money and BOQS, told me that while BOQ and ME Bank were passing on rates in full, the two subsidiary lenders would not because their offerings were “aligned to the market” and had previously been cheaper than the market.

That struck me as odd considering Virgin Money’s best variable rate still sits at 6.44 per cent, which is higher than all bar seven of the 111 lenders on Finder’s radar.

I’m not sure which market they were referring to.

Their customers agreed, taking to their social media pages to vent.

“Currently negotiating a new deal with another bank. You’ll have lost home loan and credit cards with us because of the greed,” posted Kelly Schuppe at the time.

I’ve approached them again this time to ask if they will consider passing on. No response as of yet, but it will be interesting to see how they justify it if they are again planning not to cut.

Finder’s head of consumer research Graham Cooke said there was a chance that not as many lenders would pass on the next rate cut in full.

“Historically, banks haven’t always passed on RBA rate cuts in full, especially during periods when their profit margins are squeezed,” Cooke said.

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“However, particularly with the recent rate cuts, there has been strong societal pressure for the major banks to pass on the full 25 basis point cut to their variable home loan customers, often driven by public pressure and competition.”

Indeed, NAB wasted no time, announcing at 2.31pm it would pass on the full 0.25 per cent cut to customers as of Friday, 30 May. CBA, ANZ and Westpac quickly followed suit, each passing on the cut in full.

“The competitive landscape among lenders plays a significant role. If one major bank passes on the full cut, others are often pressured to do the same to avoid losing customers,” Cooke said.

“Even if the full cut isn’t passed on by your current lender, the competitive environment means there will likely be better deals available elsewhere. This makes refinancing crucial for homeowners looking to maximise their savings.

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“A reduction of even half a per cent can be the difference of thousands of dollars a year.

“Shop around to find a variable home loan that offers a lower interest rate than your current provider. The very lowest rates now have a ‘5’ in front of them.”

With that in mind, here is the full list of lenders on Finder’s books and their best variable rate.

We will update this each day with the new rates from banks that do pass on cuts.

Banks and their best variable rates (%)

ANZ: 5.59- 30 May, 2025

CommBank: 5.59- 30 May, 2025

NAB: 5.94- 30 May, 2025

Westpac: 5.59- 3 June, 2025

Adelaide Bank: 6.04

AMP: 5.89

Arab Bank Australia: 5.7

Athena: 5.99

Aussie: 5.89

Australian Military Bank: 5.89

Australian Mutual Bank: 5.44

Australian Unity: 5.79

AusWide Bank: 5.84

Bank Australia: 5.88

Bank First: 5.74

Bank of China: 5.68

Bank of Melbourne: 6.04

Bank of Sydney: 5.79

Bank of us: 5.89

Bank Orange: 5.69

BankSA: 6.04

BankVic: 5.73

BankWAW: 5.54

Bankwest: 5.94

bcu: 5.74

Bendigo Bank: 5.89

Beyond Bank: 5.89

Bluestone: 6.79

BOQ: 5.88

Border Bank: 5.59

Broken Hill Bank: 6.64

Cairns Bank: 5.99

Central Murray Credit Union: 6.99

Central West Credit Union: 6.04

Coastline Credit Union: 6.69

Community First Bank: 5.74

Credit Union SA: 5.74

Defence Bank: 5.84

Dnister: 5.79

Easy Street: 5.84

Family First Credit Union: 5.7

Fire Service Credit Union: 5.84

Firefighters Mutual Bank: 5.74

First Option Bank: 5.74

Firstmac: 6.03

Freedom Lend: 5.9

G&C Mutual Bank: 5.74

Gateway Bank: 5.7

Geelong Bank: 5.89

Goulburn Murray Credit Union: 5.94

Great Southern Bank: 5.89

Greater Bank: 5.74

Heritage Bank: 5.74

Homeloans: 6.14

HomeStar Finance: 5.74

Horizon Bank: 5.64

HSBC: 5.74

Hume Bank: 5.74

Illawarra Credit Union: 5.74

IMB: 5.79

ING: 5.89

La Trobe: 6.54

Laboratories Credit Union: 5.95

Liberty Financial: 6.24

loans.com.au: 5.74

Macquarie Bank: 5.89

ME: 5.88

Mortgage House: 5.64

MOVE Bank: 5.69

MyState Bank: 5.79

Newcastle Permanent: 5.74

NICU: 5.74

NRMA Insurance Home Loan: 5.78

P&N Bank: 5.88

Pacific Mortgage Group: 5.64

People’s Choice Credit Union: 5.64

Pepper Money: 6.29

Police Bank: 5.59

Police Credit Union: 5.74

Qantas Money: 5.93

QBank: 5.74

Qudos Bank: 5.69

Queensland Country Bank: 5.74

RACQ Bank: 5.64

Reduce: 5.74

Regional Australia Bank: 5.69

resi: 6.14

RESIMAC Financial Services: 6.14

South West Slopes Bank: 5.95

Southern Cross Credit Union: 5.98

St.George: 6.04

Sucasa: 6.05

Summerland Bank: 5.59

Suncorp: 5.9

Teachers Mutual Bank: 5.74

The Capricornian: 5.64

The Mac: 5.67

The Mutual Bank: 5.74

Tiimely Home: 5.79

Transport Mutual Credit Union: 6.69

Ubank: 5.84

UniBank: 5.74

Unity Bank: 5.74

Unloan: 5.74

Up Home Loan: 5.75

Virgin Money: 6.44

Warwick Credit Union: 6.14

Well Money: 5.81

Woolworths Team Bank: 6.34

Yard: 6.14

Yellow Brick Road: 6.64

MORE: Finder’s full list of lenders and their updated rates here

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