BNZ lowers home loan rates ahead of anticipated OCR cut, sees 20% increase in customers

Bank of New Zealand (BNZ) has lowered home loan rates across the board and variable rates, anticipating an official cash rate (OCR) cut by the Reserve Bank on May 28, while also noting a 20% increase in home loan applications in the six months leading up to April 2025 compared to the 2024 figures. The rate adjustments include reductions across various fixed-term rates, aiming to provide customers with more choices and affordability, following cuts in term deposit rates in early May 2025.

The bank's standard six-month fixed rate dropped from 5.49% to 5.35%, while the one-year rate fell from 4.99% to 4.95%. Its 18-month term fell from 4.95% to 4.89% and two-year term fell 4 basis points to 4.95%. The three-year term fell 20 basis points to 5.09%, four-year fell 30 basis points to 5.39% and the five-year rate fell 20 basis points to 5.59%.

BNZ offers the same rates to those with 20% equity and those without. However, those with less than 20% equity will pay a low equity premium. Variable rates have also been cut.


The bank lowered rates across various investment periods in early May. Savers saw the one-year term deposit rate fall to 3.90%.

Economists widely expect the Reserve Bank of New Zealand to announce another 25 basis point cut on Wednesday (May 28).

James Leydon, BNZ's home lending general manager, expressed confidence in passing on savings due to the anticipated rate cut from the Reserve Bank.

"We know many of our customers are looking beyond the very short-term fixed rates as the interest rate environment evolves. By cutting our fixed rates across all terms, we’re giving customers more choice and the ability to lock in a competitive rate for a longer period. Lower interest rates should also help relieve some pressure on household budgets by making borrowing more affordable."