ING Direct to cut variable mortgage rates by 20 basis points

ING Direct will pass on 20 out of  25 basis points to variable mortgage holders following the RBA's 25 basis point cash rate cut on Tuesday.

The bank will reduce the interest rate on its variable mortgages by 0.20%, effective Friday 15 June with the rate on its most popular variable rate product,Mortgage Simplifier, reducing to 6.22% per annum.

ING Direct, part of Dutch banking giant ING, passed on 30 out of 50 basis points following the May RBA double cash rate cut.

It passed on both November and December quarter percentage point cash rate cuts in full to borrowers.

The ING Direct announcement follows Bank of Queensland passing on 20 basis points on Tuesday and QT Mutual Bank passing on all 25 basis points yesterday.

None of the major banks have made any announcements yet on rates.

ING Direct is the sixth largest home lender in the country with $38 billion in mortgages – ranking behind the Big Four banks and fifth biggest lender, BankWest, owned by the Commonwealth Bank.