Good morning, everyone! It's Tuesday, February 25, and today we're going to talk about mortgage rates. NAB has announced some really exciting news: they're expanding their mortgage offset capabilities!

This is a big deal, and it shows how more and more of our customers are using offset facilities since the pandemic. The data tells us that Australian homeowners are finding new ways to manage their mortgage debt, and we're here to support them every step of the way.

Join over 1000 readers. Sign up here.

We'd love it if you could share the email with your friends! Just (copy the URL here.)

Today's reading time is 7 minutes. - Miko Santos

MARKET CLOSE

Presented by CommSec

The Australian share market was pretty much flat on Monday. The banks did well, but the mining, energy, and tech stocks didn't.

ZELLER

Zeller Disrupts Australian Startup Banking with Integrated Financial Platform

In a historic move for Australia's technology industry, fintech entrepreneur Zeller has revealed a complete banking solution made especially for tech startups, so filling a major void in the financial services scene of the nation. Supported by striking data showing 87% of founders identify financial management as their main operational challenge, the launch of Zeller for Startups marks a dramatic change in how emerging technology companies access and manage their financial operations.

The initiative comes at a crucial time for Australia's startup ecosystem, Zeller's research reveals that startups typically juggle five separate platforms alongside their primary bank account, highlighting the inefficiency of traditional banking solutions in meeting the unique needs of technology businesses.

The Key Points:

• Research indicates that 85% of founders lack confidence in traditional banks' ability to support startup growth and scaling phases.

• The new platform reduces account setup complexity, requiring 60% fewer clicks compared to traditional bank onboarding processes.

• Integrated features include high-interest savings accounts with a 3.2% p.a. variable rate, unlimited debit cards, and comprehensive expense management tools.

• Strategic partnerships with key service providers like Employment Hero, Xero, and Pop Business offer additional value through exclusive discounts to users.

Bottom Line:

From a market perspective, Zeller's expansion into the startup sector represents a strategic move aimed at capturing a significantly underserved market segment. With the company already serving 85,000 SMEs in just 3.5 years, this targeted approach to tech startups could accelerate their market penetration and potentially disrupt traditional banking relationships.

For investors and market observers, this development signals increasing competition in the fintech sector and suggests potential shifts in how financial services will be delivered to high-growth technology companies. The high adoption rate of Zeller's existing services indicates a strong potential for rapid market acceptance of this new platform among users.

SPONSORED BY PODWIRES NEWS

Stay ahead of the curve with breaking news and insights, and tap into freelance marketplace opportunities tailored for podcast producers like you.

👉️ Subscribe now for free

EMPLOYMENT

Market Analysis: 6.2M Australians Consider 40-Year Mortgages Amid Housing Affordability Crisis

The Australian mortgage market is witnessing a significant structural shift as extended lending terms gain traction among potential homebuyers. Fresh data from Finder's Consumer Sentiment Tracker reveals that 30% of Australians – representing approximately 6.2 million people – would consider 40-year mortgage terms to enhance affordability, signaling a fundamental change in home financing strategies.

This emerging trend coincides with the Australian Bureau of Statistics reporting average home loan sizes reaching a record $641,416 (September 2024), marking a substantial 37% increase from September 2019's $467,403. This trajectory presents both opportunities and systemic risks for Australia's housing finance sector.

The Key points:

• Average loan size has surged 37% in 5 years, reaching $641,416 (September 2024)

• Four lenders currently offer 40-year mortgages, with three focusing exclusively on first-home buyers

• Monthly payment reduction of $300+ on 40-year vs. 30-year terms for average loans

• Additional lifetime borrowing cost of $316,000 for extended term mortgages

BottomLine:

While facilitating immediate market access through reduced monthly payments, these products introduce significant long-term capital inefficiencies, with an additional $316,000 in borrowing costs over the loan term. For institutional investors and market makers, this trend signals potential opportunities in mortgage-backed securities with extended duration profiles, while also raising questions about long-term market stability and borrower resilience.

The Key considerations:

1. Duration Risk: Extended mortgage terms significantly increase portfolio duration risk, particularly relevant in the current volatile interest rate environment.

2. Market Liquidity: The concentration of these products among select lenders may impact secondary market liquidity and pricing dynamics.

3. Systemic Implications: Growing adoption of 40-year terms could influence property market valuations and overall financial system stability.

4. Investment Strategy: Opportunities exist in both direct lending and structured products, though careful duration management becomes increasingly critical.

The emergence of this lending innovation requires sophisticated portfolio management strategies and enhanced risk assessment frameworks to navigate the evolving market landscape effectively.

BIG PICTURE

• Westpac Launches Australian-First AI Banking Tool: Cuts 6-Day Process to One Hour. Westpac and Accenture introduced Australia's first agentic AI banking solution, reducing a standard engineering task from six days to one hour and demonstrating a 144-fold efficiency improvement. As all Big Four banks accelerate their AI adoption, customer preference data shows 49% still prefer human interaction over 12% for AI chatbots.

• Rabobank Cuts Rural Loan Rates by 0.25%: Full RBA Rate Reduction Passed to Farmers. Rabobank Australia, a leading agricultural lender with 87 branches in Australia and New Zealand, has reduced variable base rates for rural loans by 0.25% effective February 28, 2025, while strategically maintaining or increasing select long-term deposit rates to support the agricultural sector amid high input costs for fertilisers, farm chemicals, fuel, and freight.

• NAB Expands Offset Accounts to 10 Per Loan as Customer Balances Surge 65% to $48B. NAB has unveiled a significant expansion of its mortgage offset capabilities, reflecting substantial growth in customer adoption of offset facilities since the pandemic, with data indicating a marked shift in how Australian homeowners are managing their mortgage debt.
  
  
  

ASB

New Zealand Retail Recovery: Q4 2024 Shows Promise Despite Economic Headwinds

New Zealand's retail sector demonstrated resilience in Q4 2024, with sales increasing by 0.9% compared to an expected 0.5% rise. This better-than-expected performance, along with a 1.4% quarter-on-quarter rise in core retail volumes, indicates a potential shift in consumer spending habits and the beginning of a broader economic recovery.

Various factors, like the effect of lower interest rates on borrowing expenses and the shift in consumer preferences towards sustainable products, are shaping the retail landscape. The data paints a convincing picture of a gradual and consistent recovery, with all 16 regions showing increased seasonally-adjusted spending values, highlighting notable progress in regions such as Queenstown and Christchurch in the South Island.

The Key Points:

• Retail volumes showed a 0.9% quarterly increase, outperforming market consensus of 0.5%, with core retail volumes demonstrating robust growth at 1.4%

• The growth was led by accommodation (7.6%) and recreational goods (5.8%), showing a resurgence in spending on leisure and tourism-related items.

• The retail deflator remained flat year-on-year, supported by price declines in fuel (-9.8%), electrical goods (-3.5%), and motor vehicles (-1.9%)

• Regional performance exhibited significant diversity, with Tasman leading with a 4.4% quarterly growth rate and notable enhancements in tourism regions across the South Island.

Bottom Line:

From a financial perspective, the Q4 2024 retail trade data carries significant strategic implications for investment decisions such as portfolio diversification, sector-specific investments, and policy decisions related to economic stimulus.

The anticipated ongoing cuts in the Official Cash Rate (OCR) by the Reserve Bank of New Zealand (expected 25 basis point cuts in April and May 2025) along with more than half of home loans scheduled to be repriced in the next six months establish a potentially advantageous setting for consumer spending growth.

However, investors should be cautious due to potential challenges, including the effects of increasing unemployment on consumer sentiment and the risks linked to inflation pressures from a weakening New Zealand Dollar (NZD) and rising oil prices. The gradual nature of the recovery underscores the need for a strategic approach to retail sector investments. Investors should pay particular attention to regional variations; for example, investing in urban areas may require different strategies compared to rural regions.

SUPPORT MENCARI

We're so grateful to our wonderful readers who make it possible for us to reach more than 1,000 inboxes with our fact-focused news. The Mencari - Banking Beacon Insights (formerly Evening Post AU) readers are so important to us because they help us to continue spreading the word without any financial or political influence. Support Free and Independent Journalism

BUSINESS & MARKETS

➡️ WiseTech Global Board Crisis: Four Directors Resign Amid Leadership Dispute with Founder. WiseTech Global, a major tech company, faces a significant leadership change as four board directors resign due to disagreements with founder Richard White, while simultaneously announcing reduced revenue expectations due to delays in launching new products, signaling a period of corporate restructuring and strategic challenges.

➡️  Realestate.com.au Hits Record 12.4M Users as Property Interest Surges in 2025. Realestate.com.au has demonstrated unprecedented market dominance in January 2025, achieving record user engagement with 12.4 million visitors, while extending its competitive advantage through exclusive user retention and significantly higher platform engagement metrics.

➡️ Asian Markets Decline Following US Economic Data; German Election Lifts DAX. Global markets demonstrated divergent performance trends, with Asian indices largely following Wall Street's downturn while European markets showed selective strength, particularly in Frankfurt following Germany's pivotal election results.

POLITICS & WORLD AFFAIRS

➡️  Australia, New Zealand Announce Major Russia Sanctions Package on War Anniversary. On the third anniversary of Russia's invasion of Ukraine, Australia and New Zealand increased their sanctions against Russia by targeting 149 new entities and individuals and 52 restrictions, respectively. Australia's total sanctions now exceed 1,400 measures backed by AU$1.5 billion in Ukrainian defence support.

➡️ Australia Fines Telegram $957,780 for Critical Delay in Terror and Child Safety Reporting. Telegram was fined $957,780 by Australia's eSafety Commissioner for a 160-day delay in responding to mandatory transparency reporting requirements for terrorist content and child safety measures. This comes amid rising national security concerns and ASIO's recent upgrade of Australia's terror threat level to "probable."

➡️ Coalition Plans $6bn Public Service Cut to Fund $8.5bn Medicare Boost. Opposition Leader Peter Dutton has unveiled a controversial fiscal strategy to fund a $8.5 billion Medicare commitment through substantial public service reductions, projecting annual savings of $6 billion by targeting nearly all of the 36,000 positions added under the current Labour government, marking a major shift in public sector employment policy

JOB BOARD

➡️  Entain's Brisbane Hub Seeks AML Specialists as Gaming Sector Strengthens Compliance. Entain Australia & New Zealand's recruitment drive for weekend AML coverage reflects the gaming industry's intensifying focus on regulatory compliance, particularly as digital wagering platforms face heightened scrutiny across the Asia-Pacific region

➡️  Major Insurance Provider Strengthens Risk Governance with New Executive Role. MLC Life Insurance's recruitment of a General Manager, Risk signals a strategic reinforcement of risk governance at a pivotal moment for Australia's insurance sector. This executive search comes as the industry grapples with evolving regulatory frameworks and increasing complexity in risk management across its nearly million-customer portfolio.

➡️ Westpac Strengthens Product Governance with Senior Role Amid Regulatory Evolution. Westpac's recruitment for a Senior Manager of Product Governance reflects the financial sector's intensifying focus on regulatory compliance and product oversight, particularly as Australia's banking industry navigates complex regulatory frameworks including Design & Distribution Obligations (DDO) and anti-hawking legislation.

👀 Hiring? Or looking for a new job

GAMES

Your click is an acceptance of Crossword Club's privacy policy and terms of use.

FROM THE TEAM

📖 I appreciate you taking the time to read! See you in the next issue. Got a question or criticism? Just click on Reply. We can talk while we are here.

🎧 Check out our podcast, the one and only "The Expert Interview." This podcast seeks the truth to answer the most pressing questions using the highest journalistic standards

✍️ Give us a press release and a good-sized landscape photo. Make sure it's newsworthy. Send press releases to [email protected] or click here. Editorially, we may rewrite headlines and descriptions.

🚀 Got a news tip ? Contact our editor via Proton Mail encrypted, X Direct Message, LinkedIn. You can securely message him on Signal by using his username, Miko Santos.