- Nov. 18, 2018
-- Andrew Thorburn is no longer NAB's highest paid executive. Coming into the Royal Commission's ultimate round next Monday, Mr. Thorburn has taken a 2.1 million dollar pay cut. In turn making Patrick Wright (NAB's chief technology officer), who earns $4.4 million the highest paid executive. The pay cut is the largest of any CEO of the big four banks. With the latest remuneration report being released last Friday, Nab's Board had agreed that within a tough environment, he'd "performed strongly". Nonetheless, it is expected that Mr. Thorburn will face a stern hearing during the Royal Commission's final round.
Just recently, NAB had become the last of the big four banks to increase their mortgage interest rates. With Westpac being the first to initiate last September, with Commonwealth Bank & ANZ soon following suit. It had taken effect on November the 9th, with NAB announcing the change on November 5th. Specifically, NAB has changed its special offer for principal and interest loans from 3.69 to 3.87 percent. However, this specifically relates to new customers on a base variable rate.
This comes approximately two months after stating that NAB wouldn't raise interest rates as had been actioned by the rest of the big four. Nonetheless, to only raise rates for new customers comes as a surprise to RateCity's research director Sally Tindall. She notes that it's "rare to see a bank hike an interest rate but grant immunity to their existing customers". This is in line with Mr. Thorburn's goal to "rebuild trust" for current customers in the present climate wanting to "keep this rate on hold for as long as we can". Ultimately, this makes Commonwealth Bank's rate of 3.79% the lowest ongoing variable rate of the big four.
This comes at a time where the RBA has not changed the cash rate (from 1.5%) for more than 2 years. Moreover, it hasn't been since November 2010 that there has been an official increase. However, the majority of Australian banks heavily rely on international funds for their loans. And with the US economy improving has resulted in a rise in Federal Reserve rates and thus higher borrowing costs for Australian banks.https://www.modoproperty.com.au/