Loan market quoted interest rate (LPR) is the reference interest rate for loan pricing. On the basis of the quoted interest rate (LPR) in the loan market, the borrower and the borrower shall negotiate to determine the actual interest rate, taking into account factors such as credit status, mortgage guarantee mode, term, interest rate floating mode and type. The specific expression should be based on the loan market quotation rate (LPR) of the corresponding term.
The People's Bank of China announced the establishment of a centralized quotation and release mechanism for LPR from 20 131October 25th.
On August 7, 20 19, the People's Bank of China issued an announcement to reform and improve the formation mechanism of quotation interest rate in the loan market, and reformed LPR from six aspects: quotation principle, formation method, term variety, quotation bank, quotation frequency and application requirements. At the same time, the Chinese name of the best loan interest rate was changed to the quoted loan market interest rate, and the English name LPR remained unchanged.
On August 25th, 20 19, the People's Bank of China issued an announcement, requiring that the interest rate of new commercial personal housing loans be based on the loan market quotation in the latest month in the same period. The added value shall meet the requirements of national and local housing credit policies, reflect the loan risk and be fixed during the contract period.
20 19128 October, the people's bank of China issued an announcement, requiring that by June 28, 2020, all financial institutions shall not sign loan contracts with floating interest rates with reference to the benchmark loan interest rate. From March 1 2020, financial institutions should negotiate with customers of existing floating interest rate loans on the conversion terms of the pricing benchmark, and convert the interest rate pricing method agreed in the original contract into LPR as the pricing benchmark (the increase point can be negative), and the value-added will be fixed during the remaining period of the contract; It can also be converted into a fixed interest rate.
On April 20, 2020, the People's Bank of China authorized the National Interbank Funding Center to announce that the quoted interest rate (LPR) of the loan market on April 20, 2020 was: 1 year LPR 3.85%, down 20 basis points from the previous period, the largest rate cut since the LPR reform in August 20 19; The five-year LPR was 4.65%, down 10 basis point from the previous period.
On July 20, 2020, Bank of Communications took the lead in issuing an announcement. On August 20, 2 1, the existing floating-rate mortgages that were not converted into loan market quoted interest rate (LPR) or fixed interest rate were uniformly adjusted to LPR floating interest rate plus or minus points. For Bank of Communications customers who have objections to batch conversion, they can also negotiate with the loan handling bank before February 3, 2020.