ANZ has become the last of the big four banks to pass on some of the Reserve Bank of Australia's (RBA) interest rate cut.
ANZ on Friday trimmed its standard variable home loan and business lending rates by 37 basis points.
The cut took the bank's standard variable home loan rate to 7.05 per cent.
The move follows the RBA's decision on May 1 to cut the cash rate by a surprise 50 basis points to 3.75 per cent.
None of the big four retail banks, which have complained of higher funding costs in recent months, chose to pass on the RBA cut in full.
ANZ's decision came just a month after it lifted its home and business lending rates by 0.06 per cent.
The bank said its decision to lower its rates would save customers with a $280,000 home loan about $20 a week.
Small businesses with an average loan of $130,000 stand to save $9.25 a week.
ANZ chief executive Australia Philip Chronican said the RBA's decision to reduce the cash rate had impacted domestic funding sources, giving ANZ the scope to reduce its lending rates.
"We continue to work hard to ensure we are competitive despite sustained funding pressure driven by the high rates we are paying to our 2.9 million deposit customers relative to the Reserve Bank's cash rate and the ongoing volatility in wholesale money markets," he said.
ANZ's shares were nine cents lower at $22.06 at 1527 AEST.