Rising retail rates pushing borrowing costs higher 30 September 2009 4:28PM Jason Bryce While the major lenders have so far held off raising rates, a couple of small regional lenders have not been able to hold their standard variable mortgage rates down any longer. Tasmanian building society B&E Limited has joined Heritage Building Society in bumping up rates on their standard variable home loan product.B&E Limited is Australia's oldest building society. Chief executive officer Paul Ranson says he tried to hold off as long as possible but eventually was forced to raise rates by ten basis points."We have had our rates under review for a while and we didn't adjust when the CBA did; we held off then but the rising cost of retail deposits in particular has meant that we couldn't really avoid this move."Ranson said B&E waited a while to see if the RBA would raise rates but really couldn't hold off any longer. Ranson was also hoping for some easing in the term deposit market."We thought the cost to us of retail deposits, in particular term deposits, may have eased a bit but that hasn't happened. Still we have still kept our rates in the competitive range - we are sitting in the middle of the big four."B&E's standard variable mortgage rate is now set at 5.77 per cent, with a discounted rate set at 5.19 per cent for loans over $250,000.The funding pressure is not coming from a shortage of cash, but the price of retail deposits, said Ranson."The money is out there, but it is expensive and it hasn't eased off. The majors have made no secret that they want more share of the term deposit market and we would say that prices in the term deposit market are much higher than the long-term average compared to the cash rate."Heritage moved its standard variable rate up 15 basis points three weeks ago to 5.45 per cent. At the time Heritage told The Sheet that the decision was a result of increased wholesale funding costs.