A select committee will investigate farmers' claims of disparity between rural and urban bank lending practices.
It is New Zealand's first competition study into personal banking services.
It follows similar moves from ANZ and ASB.
The Government is demanding "immediate and concerted" action from banks.
The bank's one-year home loan rate increased 7.19 percent to 7.25 percent, for borrowers with at least 20 percent equity.
Five ASB term deposits have increased.
Westpac is citing a rise in wholesale rates as the cause for its increase.
It comes after an 18-month low.
One employee said the bank's offer of a 7 percent pay increase is "insulting".
