Banks: Insatiable greed

SMH 15 Nov 2010

The recent round of mortgage rate rises will add an additional $1.2 billion to the total profits of the big four banks, according to the Australia Institute.

Taken together with the Reserve Bank's official 25 basis point rise, borrowers will pay an additional $3 billion in annual repayments, analysis shows.

"There is no doubt that these banks are exploiting their market power to gouge excessive profits from their customers," said senior research fellow at the Australia Institute David Richardson.

"The latest round of interest rate rises shows just how insatiable their thirst for profits is."

The Australia Institute said Australia's banks can change the contractual interest rate on more than 95 per cent of housing loans.

The Australia Institute said it based its calculation on Australian Prudential Regulation Authority housing loan data for the big four banks, adjusted down by the total value of fixed-rate home loans sold over the past three years.