ANZ's Suncorp Acquisition Sparks Concerns of Mortgage Repayment Hikes

A recent email sent to Suncorp mortgage customers has sparked concern, warning that their monthly mortgage repayments could rise by hundreds of dollars following ANZ Bank's acquisition of Suncorp. The email, sent on October 13, advised customers that if they have made advance payments and have funds available in their Cashback/redraw, their minimum loan repayment at ANZ is likely to increase.

One Suncorp customer reported that the email indicated home loan repayments could rise by more than $1,000. More than a million Suncorp customers are set to move to ANZ by 2027. Suncorp had previously allowed customers with redraw and cashback facilities to reduce their minimum monthly repayments. However, ANZ does not have this policy, so some customers are being warned their minimum repayments will increase if they do nothing.

"This increase could be significant depending on the loan balance, how much is paid in advance and the remaining loan term," Suncorp's email said.

Consumer advocates say the way Suncorp and ANZ are treating people shows how little power borrowers have in Australia. "Australians deserve better protections in the mortgage market to give them more certainty about what they will pay and the conditions for their loan," Consumer Policy Research Centre CEO Erin Turner said.

The director of data insights at interest rate comparison site Canstar, Sally Tindall, said thousands of Suncorp customers were likely to be in for an "unwelcome shock" when they find out their minimum repayments are set to rise as a result of the changeover to ANZ. Suncorp told customers that they could avoid any increase in their home loan repayments.

"For most customers there will be no change to their repayments," Suncorp Bank CEO Malcolm Stedman said. "Those customers ahead on their repayments may see an increase in their minimum repayments, if they choose to take no action."

Tindall agreed with Stedman's claim if customers followed Suncorp's email instructions. "This is because Suncorp views extra repayments differently to ANZ when they go to calculate a customer's minimum monthly repayments," she said.

The Australian Competition and Consumer Commission (ACCC) initially opposed ANZ's acquisition of Suncorp on the grounds that a resulting lack of competition would disadvantage consumers. The Australian Competition Tribunal later set aside the ACCC's decision, leading to the banking acquisition being approved by both the Queensland and federal governments.

A spokesperson for the Federal Treasurer Jim Chalmers said: "While these are commercial decisions for ANZ we expect the bank to treat its customers fairly and with respect, otherwise they'll look for better deals from others."