Updated: HSBC, BOV reduce their base rates

HSBC and Bank of Valletta said this afternoon that it they were reducing their interest rates as a result of last week's ECB interest rate change.The ECB had lowered its rate by 50 basis points.

HSBC said it is reducing its base rate for all lending rates except home loans to 3.55% (from 3.95%). The Home Loan Base Rate, which is the base for the bank’s variable mortgage lending, is being reduced to 3.35% (from 3.75%), the bank said.

The revised base rates are effective as from Wednesday, November 12.

Term deposits rates have also been reduced but the bank said interest on savings accounts has been reduced by less than the ECB rate cut, to benefit customers. The bank has also retained its higher rate on the HSBC On Line Savings Account which includes a 3% p.a. rate for balances over €5,000. This is in line with bank policy to encourage use of electronic banking and its automated channels.

Bank of Valletta said it would be changing its interest rates from Friday.

The savings accounts rate will be reduced by 0.25% resulting in an effective interest rate of 1% per annum. Interest rates on all other deposit accounts denominated in euro will also be revised downwards.

The mortgages base rate will be reduced by 0.50% per annum to 3.25% while the base rate for commercial loans, overdrafts, personal loans and credit card accounts is being reduced to 3.45%.