Bank of Valletta said it will be revising its interest rates following the decision by the European Central Bank to lower its refinancing rate.

It follows a similar move by HSBC Malta after the ECB cut its rate by 75 basis points last week.

BOV's base rate on house loans has been reduced to 2.65 per cent from the previous 3.25 per cent - a drop of 60 basis points - while the base rate applicable to other lending, such as personal loans, overdrafts, credit cards and business lending, has been revised downwards to 2.95 per cent from 3.45 per cent.

As from the first week of January, the base rate applicable to the manufacturing industry will be established at 2.85 per cent with the aim of supporting the sector in this highly volatile economic environment, the bank said.

The savings rate has been revised to 0.6 per cent and term deposit accounts from one year to five years will now carry an interest rate of 2.5 per cent. The bank has decided to retain its existing rates on all e-savings accounts, which are operated solely through internet banking and ATMs.

These rates, with the exception of the manufacturing base rate, will come into effect on Monday.

Finance Minister Tonio Fenech and the Governor of the Central Bank, Michael Bonello, said last Friday they expected banks to pass on the full benefit of the ECB rate cut to consumers.