Australia’s four biggest home-loan providers — ANZ, CBA, NAB, and Westpac — decided to slash their variable mortgage rates following the Reserve Bank of Australia (RBA) ‘s decision to lower the cash rate to a historic low of 0.5%.

The potential effects of coronavirus outbreaks abroad were considered by the RBA when deciding on its rate-cutting decision.

“The uncertainty it creates will likely also have an impact on domestic spending. Accordingly, March quarter GDP growth is likely to be less than originally anticipated. Philip Lowe, Governor of the RBA, stated in a statement that “it is difficult to forecast the impact on the changing situation.”

The big four banks offered variable rate discounts of at least 25 basis point (bps) Of the four, NAB offers the lowest variable rate for owner-occupiers and investors paying on a principal-and-interest basis.

The following image illustrates the changes in variables rates for four large banks:

Westpac was among the first to react when the central bank eased its hand and announced that it would also reduce its variable rates 25 bps.

We’re decreasing variable interest rates by 0.25% per annum for home loan customers, as well as small business cash-based loans and overdrafts. These changes take effect starting 17 March 2020.

— Westpac Bank (@Westpac) March 3, 2020

“We are aware that COVID-19 will have an immediate effect on our nation’s economic, and we need additional support for small business customers and customers who borrow from us during this unprecedented period,” said David Lindberg of Westpac’s chief executive consumer division.

CBA also announced a 25-basis point reduction in variable rates for its mortgage products. Angus Sullivan, the group executive for retail banking services, stated that the bank would contact eligible mortgage customers to inform them about the new variable interest rate.

Following the RBA’s cash rate decision we have reduced the variable rates for our home loan customers by 0.25% p.a.

— CBA Newsroom (@CBAnewsroom) March 3, 2020

He stated, “We encourage customers to take advantage of these low rates of interest and to contact us for a lower minimum repayment.” This will increase their monthly income.

ANZ made the largest reduction among the banks, reducing the variable interest rate on its investor-only loan to investors at interest-only investors of 35 bps.

If customers want to decrease their monthly minimum payments, they can contact us. We also offer fixed rates at competitive rates for those who wish to lock in these historically low rates,” Mark Hand (ANZ executive, Australia commercial and retail), said.

NAB considered both bushfires and the coronavirus when deciding to reduce variable rates 25%.

“We understand that customers may be able to use the extra money saved on mortgages in a variety ways. Some customers choose to pay off their mortgages faster while others reduce their monthly payments to make it easier to manage their household finances. Mike Baird (chief consumer officer, NAB consumer banking) stated that the role of NAB is to provide customers with choices.