The banks standard one-and-two year home loan rates would also drop, while term deposits had been reduced 0.25 per cent across the board - except for 30 days.
"While there are a range of factors in setting these rates, including the Reserve Bank of New Zealand's emergency Official Cash Rate drop of 0.75 per cent this week, we've been mindful to balance the needs of borrowers and savers," Kelleher said.
"For borrowers, every dollar counts, and lower interest rates will leave more in their pockets to help them through the disruption caused by Covid-19."
Yet customers were also looking for safer investments and so the bank needed to try to give customers an incentive to put money into bank deposits, he said.
Domestic deposits were also vital to ensure banks had enough funding to support lending, he said.
In addition to these changes, ANZ NZ cut its variable home lending rates by 75bps and
announced lower floating business loans, flexible business loans and business overdraft
rates earlier this week.
