The Reserve Bank cut the cash rate to a historic 1.75 per cent low on Tuesday afternoon. By close of business Wednesday both Hunter-based financial institutions followed suit.

The change comes into effect for Newcastle Permanent customers from May 19, and the building society argues it will put their standard variable home loan rates more than 0.3 per cent below the big four banks’.

The building society estimated it would shave $46 a month off a $300,000 home loan over 30 years while the Greater estimated the change would save their customers about $44 monthly.

Greater Bank chief executive Scott Morgan said the change would hit their bottom line. 

“I encourage mortgage holders to take a look at their current rate and look beyond the big banks for a better deal,” Mr Morgan said. 

“Use the comparison rate when assessing loans because this gives a truer indication of the real [cost].”