The announcement, ahead of the Reserve Bank’s interest rate decision, puts pressure on its rivals who are being pressured by rising funding costs, slowing credit growth and demand from politicians that they pass any RBA rate cut in full.

“We acknowledge a tougher world economy is presenting uncertainty for many customers,” said NAB group executive of personal banking Lisa Gray. “We also know that in facing economic challenges, Australian families want greater certainty. NAB will provide that certainty for customers by announcing our ongoing commitment to having the lowest SVR (standard variable rate).”

Ms Gray said the pledge applied to “all existing and new home loan customers on NAB's standard variable rate products.”

NAB has pursued a strategy of offering the lowest rates on mortgages in order to build market shares in the domestic mortgage market for the nearly three years.

Currently NAB offers a standard variable rate of 7.22 per cent, below ANZ Bank's 7.3 per cent. Commonwealth Bank offers a similar loan at 7.31 per cent, while Westpac charges 7.36 per cent, according to Canstar.

NAB this morning posted a 7.7 per cent increase in first-quarter profit of $1.4 billion, up from $1.3 billion a year ago.

The RBA will announce at 2.30pm whether it will cut the interest rate, currently at 4.25 per cent. All but three of the 27 analysts polled by Bloomberg expect the RBA to cut, while credit markets are pricing a 76 per cent chance of a rate cut.

After the RBA’s most recent rate cuts in November and December, Australia’s banks have sought to lower expectations by consumers that official rate cuts would trigger equal rate reductions by the commercial banks.

ANZ has switched its rates announcement to the second Friday of each month, with Bendigo Bank saying it would pursue a similar strategy.