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Westpac vows to toe the line on mortgage rates

Westpac chief executive officer Gail Kelly has told borrowers that the bank will not move out of step with the RBA in the future.

The major came under attack last December when it moved 20 basis points above the RBA's 0.25 per cent rate hike.

In announcing the bank's $3 billion half yearly profit yesterday, Ms Kelly said while Westpac's bank funding costs and charges remained under pressure, the major was well-funded.

"As we sit, we feel comfortable with our overall position," she said.

"It's not on our agenda to increase our mortgage prices over and above what the RBA may do."

Ms Kelly said while she was cautiously optimistic about the future, she doubted whether Australia had fully escaped the grasp of the global financial crisis.

"I get concerned when people said that the global financial crisis and we are back to normal. There's no doubt that we will be living with the effects of this crisis for a many number of years to come," she said.

"It's fair to say I'm still optimistic and I'm still cautious."

"There are reasons for caution, primarily the uncertainty which still exists in this environment. The global financial crisis was an extraordinary international economic and financial upheaval. The recovery from an event like this is seldom in a straight line."

Thursday, 06 May 2010
By: Jessica Darnbrough
Source: The Adviser