TSB Bank has followed other financial institutions and reduced its standard variable home loan rate. Yesterday it announced a 1.2 percentage point reduction from 5.15 per cent to 3.95 per cent (4 per cent APR) on the standard rate. The company has also reduced its one year discounted variable rate from 4.65 per cent to 3.49 per cent (APR 4 per cent). This rate applies to people borrowing for their principal private residences.

Most of the major financial institutions have now moved their standard variable rate below 4 per cent, although First Active has still to move its rate down. The lowest rate so far announced is the EBS offer of 3.85 per cent, announced on Thursday.