BUSINESS

Royal Bank to edge up rates on wide range of mortgages starting next week

06/07/2013 01:02 EDT | Updated 08/07/2013 05:12 EDT
TORONTO - One of Canada's biggest mortgage lenders says many of its rates are going up Monday.

Royal Bank of Canada (TSX:RY) says the increases will range from one-tenth to two-tenths of a point, depending on the type of mortgage.

The biggest increase affects a five-year closed mortgage that RBC has been offering at 3.09 per cent — a promotional rate below the regular rate of 5.14 per cent.

The special five-year rate will rise to 3.29 per cent.

Royal's one-year closed mortgages will rise 0.14 of a percentage point to 3.14 per cent and there will also be increases of one-tenth of a point for two-, three- and four-year mortgages.

Royal is the first of Canada's major banks to announce higher mortgage rates since Canadian bond prices plunged last month.

Canada's banks use the bond market to fund their commercial lending activities so other mortgage lenders may follow RBC's lead.