Banks like home loan interest rate confusion: Greg Medcraft

Banks like home loan interest rate confusion: Greg Medcraft
Banks like home loan interest rate confusion: Greg Medcraft

The ASIC corporate regulator Greg Medcraft says the big four banks should introduce residential mortgage loans that track the official cash rate.

He sees it as part of a series of measures to boost competition in banking.

Speaking ahead of his appearance before the parliamentary Standing Committee on Economics tomorrow, Mr Medcraft said mortgages priced at a fixed margin above the Reserve Bank's official cash rate would end the confusion and lack of transparency in the home loan market.

"These rate tracker mortgages are very popular overseas because the consumer knows there is a fixed margin earned by the bank over the life of the loan," Mr Medcraft said.

"The problem in Australia at the moment is there is a double jeopardy with standard variable rate loans," he said in an interview with The Australian Financial Review..

"I think the banks like the confusion in the market."

Mr Medcraft recently had his term as chairman of the Australian Securities and Investments Commission renewed.

Tags: 
Interest Rates Loans And Mortgages

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