NAB, Westpac cut interest rates of home loans

Westpac also cut the interest rates of deposits.

Westpac and National Bank of Australia (NAB) have cut the interest rates of select loans, following the Reserve Bank of Australia (RBA) cutting its cash rate.

NAB announced that it is reducing its home loan interest rate by 0.25% per annum, effective 25 August 2025.

“We expect consumer confidence to pick up as households benefit from lower interest rates, and businesses ramp up hiring and expansion, giving workers a stronger sense of job security,” said Ana Marinkovic, NAB’s group executive for personal banking.

Customers can opt to keep their repayments the same to pay down their home loan faster, Marinkovic said.

A day later, NAB said that it will reduce the interest rate on eligible lending products by 0.25% p.a..

New and existing business customers with a variable rate NAB Business Options Loan or a NAB Business Overdraft product will have their interest rate reduced from 25 August.

Westpac also announced that it is changing the home loan and deposit interest rates.

Westpac decreased the home loan variable interest rate by 0.25% p.a. For new and existing customers effective 26 August.

The bank’s analysis shows this rate change–together with the previous reductions announced in February and May— equates to saving an extra $266 per month or $3,192 per year for customers with a $500,000 home loan.
 
For deposit customers, the Westpac Life total variable rate with bonus interest will decrease by a similar rate to 4.25% p.a., effective 22 August.

The Westpac eSaver total variable rate with a five-month introductory rate will also be reduced by 0.25% p.a. To 4.25% p.a. for new customers applying online, effective 22 August.