Banks pushing low mortgage rates in branches

A sign in a Toronto Bank of Montreal branch promoting a five-year fixed mortgage rate of 2.89 percent Wednesday is just one indication that Canada's Finance Minister has his work cut if he wants to stop banks from offering ultra-low rates.

The big banks are generally toeing the line by keeping their posted - or nationally advertised - rates at higher levels after Finance Minister Jim Flaherty scolded lenders over recent rate cuts, fearing they would stoke the housing market. However, bank staff and brokers are competing hard for customers and rates below 3 percent are now the norm for five-year fixed-rate mortgages. And analysts who cover the sector say that, if anything, rates are likely to fall further.