Westpac and ANZ have joined the other two majors in defying Treasurer Josh Frydenberg's plea to pass on the RBA's full 0.25 percentage rate cut to home-owners.

Key points: The big banks have held back between 40 and 50 pc of the RBA's full cuts

The big banks have held back between 40 and 50 pc of the RBA's full cuts Treasurer Josh Frydenberg says customers should shop around for lenders prepared to pass on the full cut

Treasurer Josh Frydenberg says customers should shop around for lenders prepared to pass on the full cut The banks argue they have to balance the needs of the economy for more stimulation with their performances as businesses

Twenty four hours after the RBA moved, ANZ said it would cut its most popular home standard variable rate (SVR) loans by 0.14 percentage points, while Westpac was marginally more generous with a 0.15 per cent cut.

Westpac's decision sits alongside NAB, while ANZ's nudges in between the pair and the 0.13 per cent cut from the CBA.

ANZ also lined up with CBA and NAB passing on a substantially larger cut (the full 0.25 per cent) to investors with SVR interest-only loans.

Westpac shied away from that largesse, offering investors the same cut as given to its owner occupiers.

Shop around

The move comes after Treasurer Josh Frydenberg urged customers to ditch banks who didn't pass the cut on in full.

"People should shop around, get the best deal, but also make their displeasure known to their banks because the rate cut should be passed on in full and that would be a good thing for consumers," Mr Frydenberg said.

ANZ's head of retail and commercial banking, Mark Hand, said the decision was a difficult balancing act.

"This was a considered decision balancing the needs of our customers in a low rate environment as well the performance of our business and our role in stimulating the economy," Mr Hand said in a statement.

"While we recognise many customers will use this as an opportunity to pay down their existing home loans faster, we hope this provides the economic stimulus the Reserve Bank is wanting to generate."

Westpac's head of consumer banking, David Lindberg, said the cut brought its SVR loans to the lowest level in the bank's history.

"In making the decision, we took into account the reduction of the official cash rate and the commercial pressures of the low interest rate environment," he said.

"For an owner occupier customer with a standard variable home loan of $400,000 on principal and interest repayments, this reduction could result in a saving of $36 per month, or $432 each year."

Paul Marshall, chief executive of comparison site RateCity, said the decisions by the big banks were disappointing, but not unexpected and home loan customers would rightly feel frustrated.

"Now that the Big Four Banks have all made their move, we expect a flurry of other lenders to begin announcing their cuts," Mr Marshall said.

"New customers are still getting the sharpest home loan rates."

Bank SVR Old rate New rate Saving per year Missed saving per year Westpac 0.15pc cut 4.98pc 4.83pc $438 $290 NAB 0.15pc cut 4.92pc 4.77pc $436 $289 ANZ 0.14pc cut 4.93pc 4.79pc $408 $318 CBA 0.13pc cut 4.93pc 4.80pc $379 $314

Source: RateCity.com.au Note: The rates are for owner-occupiers paying principal and interest on a $400,000 loan over 30 years. Missed savings are calculated based on what a customer would have saved if the bank had passed on the full rate cut of 0.25 per cent.