To meet market demands and maintain a continual leading edge, China Everbright Bank renovated its products and launched fixed interest rate period/amount-combined housing loans (for residential housing and commercial housing).
China Everbright Bank is the first China-invested commercial bank to launch fixed interest rate amount/period-combined loans for commercial housing.
Fixed interest rate amount-combined loan implements fixed interest rate on a certain portion of principal and floating interest rate on the rest during the loan term, meeting the customers¡¯ demands of avoiding interest rate risks.
Fixed interest rate period-combined loan allows the combination of ¡°fixed + floating¡± period and the combination of ¡°fixed + fixed¡± period. Customers may divide the loan term into two periods when applying for residential or commercial housing loans: on the condition of choosing fixed interest rate for the first period, customers are allowed to select fixed or floating interest rate for the second period according to their interest rate expectation. Such products satisfy customers¡¯ demands of appointing different fixed interest rates for different period.
The maximum term of ¡°fixed + floating¡± period-combined housing loans is 30 years and that of ¡°fixed + fixed¡± period-combined housing loans is 20 years. The fixed interest rate period-combined product successfully satisfies customers¡¯ demands of prolonging the term of fixed interest rate loans against an expectation of interest rate increase.
China Everbright Bank has granted more than 7,000 fixed interest rate loans since the product was launched one year ago, with the amount surpassing RMB3.3 billion and ensuring a leading position in market share, product facilities and brand reputation. Currently, China Everbright Bank is the first China-invested bank allowing for transformation between fixed and floating interest rate and the only bank extending commercial housing loans at fixed interest rate.
Due to the influence from interest rise by the central bank, China Everbright Bank made a moderate adjustment to the level of fixed interest rate.
The benchmark interest rates for 3-year, 5-year and 10-year fixed interest rate personal residential housing loans were increased by 0.21 percentage points; and the ceiling interest rate and preferential interest rate for loans of various terms were also adjusted accordingly (See Table 1).
Table 1: Interest Rates for Fixed Interest Rate Residential Housing Loans Before and After the Adjustment
|
Term |
After the adjustment |
Before the adjustment |
|
Ceiling (%) |
Benchmark (%) |
Preferential (%) |
Ceiling (%) |
Benchmark (%) |
Preferential (%) |
|
¡Ü3 years (Inclusive) |
7.04 |
6.54 |
6 |
6.72 |
6.33 |
5.76 |
|
3-5 years (Inclusive) |
7.13 |
6.63 |
6.15 |
6.92 |
6.42 |
5.94 |
|
5-10 years (Inclusive) |
7.37 |
6.87 |
6.33 |
7.16 |
6.66 |
6.18 |
The benchmark interest rates for 3-year, 5-year and 10-tear fixed interest rate personal commercial housing loans were increased by 0.27 percentage points; and the ceiling interest rate and preferential interest rate for loans of various terms were also adjusted accordingly (See Table 2).
Table 2: Interest Rates for Fixed Interest Rate Commercial Housing Loans Before and After the Adjustment
|
Term |
After the adjustment |
Before the adjustment |
|
Ceiling (%) |
Benchmark (%) |
|
Ceiling (%) |
Benchmark (%) |
|
|
¡Ü3 years (Inclusive) |
7.49 |
6.99 |
6.49 |
7.22 |
6.72 |
6.22 |
|
3-5 years (Inclusive) |
7.67 |
7.17 |
6.57 |
7.4 |
6.9 |
6.3 |
|
5-10 years (Inclusive) |
7.94 |
7.44 |
6.74 |
7.67 |
7.17 |
6.57 |
The interest rate increase by the People¡¯s Bank of China gives full performance to the advantages of fixed interest rate loans provided by China Everbright Bank, which is capable of locking at a fixed cost and avoiding the risks arising from interest rate fluctuation. |
