30 October 2011
Yellow Brick Road Holdings Limited (ASX: YBR) in conjunction with partner Gateway Credit Union Ltd has announced a guarantee to pass rate reductions onto their mortgage clients in the event that the Reserve Bank of Australia drops rates at their meeting of monetary policy on Melbourne Cup Day. Yellow Brick Road Executive Chairman Mark Bouris has called on the banks to follow suit and give Australian mortgage holders their first reprieve since the last interest rate cut on 8 April 2009.
“The mortgage belt of Australia has become enslaved to the first Tuesday of every month when they wait to hear if the RBA will grant them relief,” says Yellow Brick Road Executive Chairman Mark Bouris. “There is something very wrong with the fact that our country is reliant on what the RBA decides and that each month we’re faced with a dichotomy between freedom and punishment. Melbourne Cup Day is the perfect opportunity for the RBA to side with consumers and take back last year’s bank rate spike that came off the back of the November monetary policy decision. Surely that domino effect was not the RBA’s intention and now is the time for them to take matters into their own hands to offset last year’s rate rise and give consumers back some confidence.”
If the Reserve Bank cuts rates on Melbourne Cup Day, Yellow Brick Road has pledged to pass the savings on in full to Yellow Brick Road mortgage holders via partner Gateway Credit Union, and the company has challenged the banks to make the same commitment and give all Australians the opportunity to get a better deal.
The November RBA meeting is a very real opportunity to cut rates as the September quarter Consumer Price Index revealed historically low data with the average trimmed and weighted mean clocking in at 0.3%, the lowest result since Q3 in 1997. If the RBA doesn’t reduce rates now, it will be unlikely for them to do so in December and there won’t be another opportunity until February 2012.Yellow Brick Road has been calling on the Reserve Bank to cut interest rates since the company launched ‘The RBA Appeal’ campaign back in June.
“Yellow Brick Road started ‘The RBA Appeal’ movement because people were coming into our branches asking questions about monetary policy and why the Reserve Bank wasn’t taking action to assist besieged Middle Australians,” says Bouris. “That’s why we gave hard working Australians, the engine room of this country, the opportunity to vocalise their plights to the RBA. It has taken six months but it is our hope that on Melbourne Cup Day the RBA will finally listen to the people’s plea.”
If the Reserve Bank announces a cut, a quarter percent rate reduction on an average family’s $350,000 mortgage will put $700 back into the family budget over the next 12 months. Yellow Brick Road and their partner Gateway Credit Union Ltd believe this savings should be a requirement for lenders pending the RBA’s announcement.
“Over the last 18 months Yellow Brick Road and Gateway Credit Union have been working to provide real competition in the market to show that this synergistic partnership can level the playing field with the major banks,” says Gateway Credit Union Ltd CEO Paul Thomas. “With our strong product capabilities and a national distribution network, we feel it is our obligation to give Australians the better option on their mortgages if the RBA makes the decision to cut rates.”
Copyright © 2012 Yellow Brick Road
