Banks adjust their rates after ECB decision

HSBC and Bank of Valletta this afternoon announced a raising of their interest rates in line with the decision by the European Central Bank to raise its reference rate to 4.25 percent.

HSBC said that as a result of the ECB changes and reflecting the current economic environment it. has adjusted its Base Rate to 4.35%. It is also introducing a Home Loan Base Rate (HMLR) which will be 4.25%. The HMLR will be the base for the bank’s variable mortgage lending.

The bank has also raised the rates on a number of its savings and deposit accounts. In some instances this rise is above the increase in the ECB rate rise to make the bank’s products more attractive and to encourage further savings, HSBC said.

Bank of Valletta said it will be raising its Base Rate to 4.25% with effect from 7th July.

BOV referred to its decision announced on the 28th December 2007 that, with effect from the 1st January 2008 and until further notice, it was adopting the ECB refinancing rate as its Base Rate and said that the increase being announced today reflected this policy.

With effect from 7th July 2008, the interest rates on euro denominated savings and term deposit accounts will increase by 0.25% p.a. Similarly, debit interest rates on loans and overdrafts, as well as on credit cards will be revised upwards by 0.25% p.a. with effect from the same date.