After the Reserve Bank’s first OCR increase in three years, four of New Zealand’s biggest home lenders have kept their mortgage serviceability test rates unchanged. ANZ NZ, ASB, BNZ and Kiwibank all confirmed to interest.co.nz this week that their buffers remain in place, and Westpac NZ said the same on Monday. ANZ NZ had already moved its buffer in April, two and a half months before the RBNZ acted.
The decision leaves borrowers’ maximum borrowing capacity sitting exactly where it sat before the RBNZ lifted the OCR by 25 basis points to 2.50% on 8 July, its first increase since May 2023, according to the RBNZ’s full July 2026 OCR statement. The headline cash rate has shifted. The stress-test buffers the five banks apply to new home loans have not. Most bank economists are still forecasting further hikes to come.
The Test Rates, Side by Side
Five major banks hold the stress-test buffers they apply to new home loan applications. ANZ NZ, the country’s largest home lender, sets its Servicing Sensitivity Rate at 6.85%, last moved on 22 April 2026. ASB matches at 6.85%, BNZ is the highest at 7.10%, and Kiwibank and Westpac both sit at 6.95%.
| Bank | Test Rate | Last Changed |
|---|---|---|
| ANZ NZ | 6.85% | 22 April 2026 |
| ASB | 6.85% | Not disclosed |
| BNZ | 7.10% | Not disclosed |
| Kiwibank | 6.95% | 1 July 2026 |
| Westpac | 6.95% | Not disclosed |
Beyond the big five, smaller lenders show wider variation. SBS Bank has held 6.50% since 20 October 2025. TSB sits at 6.99%, and Co-op Bank’s current rate is unpublished, with its last disclosed figure dated 24 February 2025. A live bank test rate comparison table is maintained by interest.co.nz as a reference resource for borrowers.
Across the five major banks, the spread between the lowest and highest test rate is 25 basis points, a tight band. Each rate is set as an internal buffer above the carded rate the borrower actually pays. None of the five banks describe the buffer as marketing material, and none compete on it directly.
Why the Banks Held
The banks’ language was strikingly similar this week. ANZ NZ’s spokesperson drew the clearest line: the Servicing Sensitivity Rate is just one tool the bank uses to assess a home loan application, and ANZ NZ does not market it. The bank does not compete with other lenders to offer lower test rates, the spokesperson said, because the buffer exists to help protect customers when they borrow money. Adjustments to the SSR reflect changes in the interest rate environment across all cycles. The bank declined to disclose what its prior SSR was before the 22 April reset.
ASB was briefer. The bank’s servicing test rate remains appropriate after regular internal review, a spokesperson said, with the bank weighing a range of affordability factors alongside the buffer. BNZ pointed to market conditions and its responsible lending obligations as the triggers for any future change.
Neither ASB nor BNZ described last week’s OCR move as material enough to warrant a buffer adjustment. The RBNZ’s own study of how banks pass OCR changes through to mortgage and deposit rates shows the pass-through to carded rates is itself uneven. That unevenness is why the test-rate buffer sits as a separate instrument, not a derivative of the carded rate. Each bank tunes its buffer on its own schedule, against its own view of the lending cycle.
Kiwibank was the most explicit on method. The bank weighs wholesale rates, carded rates, and the OCR together, a spokesperson said, and does not treat its test rate as a forecast. The banks cannot agree on what the OCR will do next.
Where the Bank Economists Disagree
The spread on where the OCR peaks is unusually wide. Westpac NZ has brought its peak forward, now expecting the cash rate to top out at 4% by the September 2027 Monetary Policy Statement, three months sooner than the bank had previously pencilled in. ASB sees a more measured climb: 25-basis-point hikes from September to reach roughly 3.25% by the end of 2026. Kiwibank sits at the other end, arguing that the case for further tightening has not yet been made. Three of the four desks cited by interest.co.nz cover a 75-basis-point range on the eventual peak.
Those forecasts put a 75-basis-point gap between the highest and lowest expected peak. The OCR has moved 25 basis points so far, and the banks’ research desks still span 75 basis points on where the cycle ends. A 25-basis-point move is small enough inside a 75-basis-point forecast range that a bank could rationally leave its test rate alone.
Before the decision, the banks’ economists were split on the OCR direction itself. ANZ NZ and BNZ economists expected the 25-basis-point move, while ASB, Westpac NZ and Kiwibank economists had anticipated a hold. The NZIER’s shadow board was also divided on which way the RBNZ should vote. The split on the rate direction means the unanimity on test rates is five separate decisions that landed at the same number, not a single coordinated stance.
- Westpac NZ peak OCR forecast: 4% by September 2027
- ASB year-end 2026 OCR forecast: roughly 3.25%
- Kiwibank: case for further tightening not yet made
- Spread between highest and lowest forecast: 75 basis points
What It Means for Borrowing Capacity Right Now
A lower test rate means a bank assumes a lower repayment burden when deciding how much a borrower can service. Banks run the affordability check at the test rate, not the carded rate, which is why the buffer has an outsized effect on maximum loan size. Five banks holding their buffers steady this week means borrowing capacity stays where it sat before the OCR hike.
The buffers are not nailed to the floor. They are calibrated to the lending cycle, and the lending cycle is not finished. The Monetary Policy Committee has signalled that further OCR increases appear likely at upcoming meetings. Bank economists project peaks anywhere from below 3% to 4%.
It’s important to note, test rates are not a prediction of future interest rates; instead, they give us the ability to check the customer can maintain their financial commitments.
A spokesperson for Kiwibank, one of New Zealand’s five major banks, gave the framing to interest.co.nz this week. Kiwibank’s statement spells out that test rates are a moving buffer tied to the cycle, not a forecast. Banks will revisit them as the inputs change.
ANZ NZ moved its Servicing Sensitivity Rate on 22 April 2026, with the OCR still at 2.25%. The other four banks now sit within 25 basis points of ANZ NZ’s level. None of the five has set a public trigger for when its buffer would next move. Westpac NZ still has the OCR peaking at 4% by September 2027, the highest of the three bank forecasts on the record.
ANZ Already Pulled the Lever in April
ANZ NZ lifted its Servicing Sensitivity Rate to 6.85% on 22 April 2026, when the OCR was still at 2.25%. ANZ NZ did not disclose what its prior SSR was. ASB matches at 6.85%, BNZ sits 25 basis points higher at 7.10%, and Kiwibank and Westpac both sit at 6.95%. The four other banks all sit within 25 basis points of ANZ NZ’s level.
ANZ NZ is the country’s largest home lender. Kiwibank’s test rate was last moved on 1 July 2026, two days before the RBNZ’s most recent meeting. BNZ, ASB and Westpac have not disclosed when their buffers were last reset. The 22 April reset is the only dated buffer move among the five major banks, and it came ahead of the OCR hike, not after it.
The Hike in Context
The July move was the first OCR increase since May 2023. The RBNZ’s six-member Monetary Policy Committee reached consensus on the 25-basis-point lift, with internal members Anna Breman, Karen Silk and Paul Conway joining external members Carl Hansen, Prasanna Gai and Hayley Gourley in backing the move. The decision came with a trimmed inflation forecast: annual headline inflation is now expected to have peaked at 3.9% in the June 2026 quarter. It is forecast to ease to 3.3% in the September 2026 quarter. Statistics NZ is scheduled to release the official June quarter CPI on 21 July.
The OCR has moved a long way to get here. It began 2025 at 4.25%, ended the year at 2.25%, and sat at that level through the first half of 2026 before last week’s hike. The RBNZ also used the July statement to approve the full divestment of its Large Scale Asset Purchase holdings by June 2027, unwinding a pandemic-era bond portfolio that had cost the Bank roughly $10.5 billion in crystallised losses once rates rose.
For an overview of how the banks handle the related question of pass-through to actual mortgage rates, the Banking Reform Coalition’s push for FMA action on slow OCR pass-through captures the consumer-side pressure on lenders. None of the test-rate commentary this week engaged with that backdrop. Westpac NZ’s house view has the OCR peaking at 4% by September 2027. ASB’s forecast is closer to 3.25% by year-end 2026, and Kiwibank still questions whether further tightening is needed.
Frequently Asked Questions
What is a mortgage serviceability test rate?
A mortgage serviceability test rate is the buffer rate a bank applies when stress-testing a borrower’s ability to repay a home loan if interest rates rise. It is typically higher than the carded rate the borrower actually pays, and it is an internal tool for assessing affordability rather than a published lending offer.
Did the major NZ banks change their test rates after the OCR hike?
No. ANZ NZ, ASB, BNZ, Kiwibank and Westpac all confirmed to interest.co.nz that their mortgage serviceability test rates were unchanged following the RBNZ’s 25-basis-point OCR increase to 2.50% on 8 July 2026.
What are the current test rates at the big NZ banks?
ANZ NZ and ASB both hold their test rate at 6.85%. BNZ is at 7.10%, the highest of the five major banks. Kiwibank and Westpac both sit at 6.95%.
How does the test rate affect my borrowing capacity?
A lower test rate increases the maximum loan a bank will approve, because the bank is stress-testing against a smaller repayment burden. With all five major banks holding their buffers this week, borrowers’ maximum borrowing capacity is unchanged from where it sat before the OCR hike.
Will the banks raise test rates if the OCR keeps climbing?
Banks have not committed to a specific trigger. Westpac NZ expects the OCR to peak at 4% by September 2027, ASB projects roughly 3.25% by year-end 2026, and Kiwibank says the case for further tightening has not yet been made. The buffers will be reviewed as those forecasts evolve.
