Borrowing interest rates
reduced in all currencies
BRR lowered to 5.75 on dollar
and to 7.75 on lending in lira
The Association of Banks (ABL) said it has reduced the Beirut Reference Rate (BRR) on loans in dollars to 5.75 percent from 9.35 percent.
The BRR on lira has also been lowered to 7.75 percent from 12.45 percent.
“These significant and important reductions in the interest rate structure in response to circulars issued by the Central Bank (BDL),” read the ABL statement
The Beirut Reference Rate is a benchmark rate and is a methodology to calculate the Beirut Cost Rate (BCR). It is a reference rate in fiduciary contracts. This rate allows the banks, after the addition of the cost of the fiduciary process and the profitability of the banks, to set the best debtor interest rate. The ABL, in the calculation of this reference rate, relies on the average cost of term deposits in dollars, in addition to the average operational cost in the local banking sector, in proportion to the overall deposits which are weighed by credits in dollars to the overall credits.
ABL also said that it has recommended member banks to adopt an exchange rate of LL2,600 to the dollar for withdrawals carried out by small depositors as required by a recent BDL circular.
Date Posted: Apr 15, 2020