Bank of Melbourne entices customers with 1% mortgage rate discount

New Westpac bank brand the Bank of Melbourne will offer customers who sign up for multiple products a discount of up to 1% on the standard variable mortgage rate under a tiered scheme.

“We will reward customers for the depth, breadth and quality of their banking relationship with Bank of Melbourne,” says chief executive Scott Tanner.

“For instance, a home loan customer will get a greater discount on their interest rate if they have more products and services with Bank of Melbourne.”

Customers who choose to have their transaction accounts, savings, insurance, superannuation and wealth management with Bank of Melbourne will receive a “significant discount on their standard variable interest rate,” Tanner says.

Tanner’s comments are included in a media release, which makes no mention of St George, the brand the bank is replacing in Victoria.

The discounts are part of a plan to try and bring new customers to the bank.

“Because we’re the new bank on the block we’re hungry for business,” Tanner said during a tour of a new bank branch in Richmond.

Currently, St George is offering customers a standard variable rate of 7.8%.

Customers who sign up for St George’s bundled Advantage package (home loan, credit card and transaction account) qualify for a discount of 0.95% on the interest rate.

Details of the pricing structure will be revealed on July 25, when the new bank brand replaces St George bank in Victoria.

In total 41 Bank of Melbourne branches and five corporate banking centres will be in operation.

In addition to the 38 existing Victorian St George branches changing over to the new brand, three new branches will open in Richmond, Forest Hill and Plenty Valley.

The bank plans to add an additional 85 branches in the next four years, with 14 of the new branches to open in 2011.

Over the next 12 months existing customers of St George in Victoria will be issued with new Bank of Melbourne credit cards, debit cards and cheque books.

Mortgage holders will continue to pay off their loans under their existing St George agreements.

Investment involved in launching the Bank of Melbourne, including establishing the infrastructure to support the new bank, is expected to be about $90 million, with $26 million spent to date.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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