National Australia Bank home loan customers will save an average $62.50 a month in interest after NAB today announced it would cut its standard variable home loan rate by 0.25%p.a. to 5.63%p.a.

Gavin Slater, Group Executive Personal Banking, said the cut meant NAB was offering its lowest standard variable rate in nearly 40 years.

“This means NAB customers with a standard variable home loan will on average save $62.50-a-month or $750-a-year in interest payments – a significant saving for Australian households,” he said.

Mr Slater said NAB was committed to competition and delivering a greater customer experience.

“NAB has led the industry in making banking fairer for all customers. We abolished the fees and charges that annoyed customers the most and we are the only major bank to have a fully featured personal transaction account available to all our customers with no monthly account keeping fees,” he said.

The new standard variable rate is effective from Friday, 20 February, 2015. NAB will also reduce its rate on standard variable business lending products by 0.25%p.a.

Note to editors: The monthly saving reflects interest savings resulting from the 0.25%p.a. reduction in SVR on a $300,000 interest-only home loan.