Westpac’s business customers have received greater interest rate relief than mortgage holders, with the bank saying the sector needs a boost in the current economy.

Westpac became the third of the big four banks to cut rates when it took 37 basis points off its standard variable home loan rate on Friday, to 7.09 per cent.

That compares to a 40 basis point cut by Commonwealth Bank on Thursday to 7.01 per cent, and a 32 basis point cut by National Australia Bank (NAB) on Wednesday to 6.99 per cent.

The cuts follow the surprise decision by the Reserve Bank of Australia (RBA) to reduce the cash rate by 50 basis points on Tuesday.

Westpac, which delivered a near $3 billion first half net profit on Thursday, handed the largest benefit to businesses since the RBA’s move by passing on the full cash rate cut.

“We feel it is particularly important to help small businesses at this time,” Westpac executive of retail and business banking Jason Yetton said in a statement.

“If business is doing well, it follows that we’re all doing well.

CBA cut 40 basis points from its residentially-secured business loans, while NAB’s business customers got the same reduction in rates as its mortgage holders.

Westpac’s deposit holders also got some good news, with no change made to the banks interest rates on term deposits.

“We want to continue to help both our business and mortgages customers, while maintaining attractive high interest rates on deposits,” Mr Yetton said.

The new rates take effect on May 14, Westpac said.

It said the rate cut would save homeowners with an average $300,000 mortgage $900 a year in monthly repayments.

Regional lender Bendigo and Adelaide Bank also cut its mortgage rate on Friday, by 35 basis points to 7.1 per cent.

ANZ will make its decision on interest rates on May 11.