Loan pricing refers to the different levels of interest charged by commercial banks based on the analysis of the cost, expected income and risk of credit funds, according to the different credit status of borrowers and other factors. So, what are the factors that affect loan pricing? 1. Capital cost and operating cost of credit products provided by banks. There are two different calibers of capital cost: historical average cost and marginal cost, and the latter is more suitable as the pricing basis of loans. The operating cost is the direct or indirect cost that the bank generates for the investigation, analysis, evaluation and loan follow-up before lending. 2. Loan risk. Credit risk exists objectively, but in different degrees. Banks need to demand compensation for default risk on the basis of predicting loan risk. 3. Term of the loan. The longer the loan term, the higher the interest rate. The longer the loan term, the worse the liquidity, the more uncertain factors such as the expected annualized interest rate trend and the borrower's financial situation, and the higher the loan price term risk premium. 4. profit target level of banks. On the premise of ensuring loan security and market competitiveness, banks will strive to make the expected annualized rate of return of loans reach or exceed the target expected annualized rate of return. 5. Competitive situation in financial markets. The bank will consider the loan price level of its peers before deciding the loan pricing of the bank. 6. The overall relationship between banks and customers. Loans are usually the support point for banks to maintain customer relationships, so the business cooperation relationship between customers and banks should also be fully considered when pricing bank loans.