ANZ National Bank and UDC Finance have now both been confirmed as participants in the New Zealand Retail Deposit Guarantee Scheme announced by Treasury last month.
Households are still feeling financial pressures as a result of the recession. However, recent decreases in interest rates and expected further falls in rates by the end of the year means that fixed term mortgage rollover pricing will move from being an extra cost to customers to delivering a cashflow benefit. In combination with tax cuts and falling petrol prices, this will take some pressure off household cashflows.
Countering this is an expected rise in unemployment which will, in part, replace interest rates as the main cause for household financial concerns going into 2009.
As the economy has moved into recessionary mode, the bank has responded in a number of ways to make sure customers are in a position to manage the flow-on effects of the change in the economic cycle.
Over the course of the year, and as would be expected from a responsible lender, we’ve made a number of adjustments to the credit policy (most recently this week) to ensure we maintain our focus on serviceability and ensuring that customers are protected from the combined impact of the financial conditions and softening property market.
We have also established a programme to help customers who may not be coping with the extra pressure on household budgets, and in particular where mortgage payments may be missed.
“We genuinely want to help customers stay in their homes” says Mr Hodges.
“Taking a case-by-case approach, the goal is to re-establish customers’ financial commitments to a more manageable and sustainable level.”
The Bank is working closely with the Retirement Commission and the Federation of Family Budgeting Services in the delivery of this programme.
“Our advice for customers who are under pressure financially is to talk to their Bank as soon as possible - the sooner we know a customer may be in difficulty, the greater the range of options that are available to both the bank and the customer,” says Mr Hodges.