BNZ has jumped ahead of the pack as the jostling for the market lead in floating mortgages continues to intensify.

The bank has cut its TotalMoney variable mortgage rate by 26 basis points to 5.59%, undercutting Westpac, which was previously the market leader in a rein that lasted only three days.

Westpac announced on Monday that it was offering a variable rate of 5.69%, only a week after ASB dropped its own rate to a 40-year low of 5.75%.

BNZ has also cut its other variable rate mortgages 31 basis points to 5.99% and has cut its Rapid Repay and Mortgage One rates to 5.99% and 6.40% respectively.

BNZ director, retail Chris Bayliss said: “Over the past year we’ve reduced our variable loan rates by 4.90% to ensure that we offer New Zealanders competitive rates which will enable them to reduce the principle on their loan at a quicker rate.”

The recent run of cuts to variable rates has followed criticism from various politicians who claimed banks weren’t fully passing on Official Cash Rate (OCR) cuts to mortgage customers.

However, long-term fixed rates, which are less tied to the OCR, have been trending upwards since March.