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Banks' reluctance to pass official cash rate cuts on to borrowers is hitting businesses even harder than home buyers.
One key Reserve Bank measure of business borrowing costs has barely budged since the central bank began cutting less than a year ago.
RBNZ data showing the base interest rate offered to new business borrowers, weighted by market share of the lender, showed the base rate at 12.39 per cent in March had changed little from its 13.66 per cent level before the RBNZ began cutting the OCR in July last year.
Over the intervening period, the OCR, not counting last week's 50 basis-point cut, has fallen 5.25 percentage points. Variable residential mortgage rates by comparison fell from 10.9 per cent to 6.41 per cent over the same period.
The data supports the view from business groups that the major banks have been dragging their feet in passing on OCR cuts to business borrowers.
"It's not good, we feel quite nonplussed by it, and we don't understand it," said Employers and Manufacturers Association chief executive Alasdair Thompson.
Thompson noted comments by Finance Minister Bill English and Reserve Bank Governor Alan Bollard stating their expectation that more benefit from OCR cuts should be passed on to borrowers including businesses, "and it doesn't seem to be happening".
"Banks are crying they have to pay more for money they get overseas and that's why rates have held up, but business rates have held up much higher than those for home owners and I don't think that's fair or right."
Derek Rankin, of Rankin Treasury Advisory, said some banks had justified maintaining business rates at high levels by saying poor economic conditions made business lending a riskier proposition and they were simply charging for that additional risk.
While that had some semblance of logic, he noted rates for some of his clients, whose borrowing was secured, were not coming down.
Ian Blair, general manager of business banking at Westpac, said his bank's business borrowing rates had "reduced substantially".
But he did not have relevant data to hand allowing him to give details of how much or over what time frame.
Nevertheless, he maintained rates had come off "dramatically" more than the Reserve Bank data indicated and fixed rates, priced off wholesale rates with an added margin, had come off even more.
Blair also pointed out a majority of small business customers borrowed against their homes and had consequently had the benefit of falling retail mortgage rates.
He said high offshore funding costs and retail deposit rates were keeping upward pressure on borrowing rates, and confirmed Westpac had introduced a "global liquidity cost".
This is understood to be running at about 0.5 percentage points and is charged over and above the standard margin charged on business borrowing priced off 90-day bank bills.
A spokeswoman for ANZ National said the bank's business lending rates had fallen by 2.5 percentage points since December.
She said all business and commercial lending was "evaluated on a case-by-case basis and reflects our assessment of risk and the security being offered".