The Bank of the Cook Islands has lowered their standard household mortgage interest rate down from 8.99 per cent per annum to 8.49 per cent and business loan base rates from 8.2 per cent per annum to 7.7 per cent per annum effective from 1 June 2015.
The Cook Islands Minister of Finance, the Honourable Mark Brown, welcomed the announcement by the BCI to lower interest rates on existing and new loans for households and businesses by 0.5 per cent per annum.
“This reduction will equate to an immediate saving of around $900 a year on a $180,000 mortgage. This equates to around $17 a week extra returning back to BCI customers.
When we first came to Government the equivalent mortgage rate at the BCI was 9.5 per cent, the rate reductions since that time is equivalent to a saving of $1,818 per annum on a $180,000 mortgage.
I am also pleased to see that base business loan rates have moved from 8.95 per cent when we first came to Government to 7.7 per cent over the same time. A very significant decline and I hope that this sparks some confidence and activity in the business sector.”
With the impending entry of Bank of the South Pacific (BSP) into the Cook Islands the Minister looked forward to a continued competitive environment which would deliver to Cook Islanders.
Minister Brown commented that “the Banks appeared to have moved on from an environment of charging what they believed people were prepared to pay rather than competing with a lower price, a better product and better service.”
The Government is now putting the final touches to the 2015/16 Budget. Minister Brown further outlined that further announcements would be forthcoming on how the Budget would be assisting people.
“The Government’s continued efforts to ease the impacts on the cost of living will be ongoing, and there will be some new initiatives in the budget which will go some way to helping our people.”
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