METHODOLOGY AND PROCEDURE FOR THE DETERMINATION OF BASE AND HOUSING LOANS RATE
The aim of this document is to define, clarify and present the procedure and methodology for the determination of Eurobank Cyprus Ltd (the ‘’Bank’’) Bank’s Base Rate and the Bank’s Housing Base Rate (jointly referred to as the ‘’Base Rates’’) in accordance with the provisions of the Liberalization of Interest Rates and Relevant Matters Law No. 160(I)/1999 as amended to-date.
1. Current Methodology of calculating the Bank's lending Base Rates - Link to Benchmark Rate
The Bank’s Base Rates are linked to the three-month Euribor interest rate (Euribor 3M) which reflects the average cost at which Eurozone Banks offer to lend unsecured funds in the wholesale market.
The Euribor rate is published by the European Money Markets Institute (EMMI) or any successor thereto and it is available online at here
If the value of the Euribor 3M on the day of the calculation of the Base Rates is negative, the Bank considers it as having a value of zero.
The Bank reserves the right to amend the methodology of calculating Base Rates and/or the Benchmarks used as described below.
Calculation Frequency and updating on Bank’s website
- The Base Rates are revised on a quarterly basis on 15 March, 15 June, 15 September and 15 December of each year (the ‘’Adjustment Dates’’), or on the following working day if the 15th day of any of the said months falls on a local or TARGET holiday.
- The latest Bank Base Rates can be found at the Bank’s website.
Definition of the Bank’s Base Rates
Bank Base Rate (BBR): Euribor 3M + spread of 3.65%
Bank Housing Base Rate (BHBR): Euribor 3M + spread of 1.50%
Temporary change of BHBR to: Euribor 3M + spread of 1.00%. Effective from 15/3/2023 to 14/3/2024 or until otherwise advised by the Bank.
Example for the Bank’s Base Rate calculation
Adjustment Date: 15/03/2023
Euribor 3M published on 14/03/2023 (for Value 15/03/2023) = 2.753%
Revised Bank’s Base Rate (BBR): Euribor 3M + spread of 3.65% = 2.753% + 3.65% = 6.403%
Revised Bank’s Housing Base Rate (BHBR): Euribor 3M + spread of 1.00% = 2.753% + 1.00% = 3.753%
Effective Date: 15/03/2023
Next Calculation Date: 15/06/2023
2. Conditions and Parameters which may contribute to changes in the methodology of calculating the Bank’s Base Rates and/or in the Benchmarks used
- The Bank reserves the right to amend the methodology of calculating Base Rates and/or the Benchmark rate used if necessitated by regulatory changes or changes in market conditions.
- The Bank may elect to link the Base Rates to a different Benchmark Rate or to adjust the respective spread over that Benchmark rate.
Customers shall be notified in the case of changes in the methodology, the Benchmark Rate or the applicable spread.
3. The Action plan in the event that a benchmark materially changes or ceases to be provided in accordance with Article 28(2) of Regulation (EU) 2016/1011.