LPR conversion is for borrowers with floating-rate loans priced with reference to the central bank's benchmark interest rate. It refers to changing the pricing basis of mortgage interest rates from the original central bank's benchmark interest rate to LPR. The main reason for converting personal loans to LPR is that the pricing benchmark and pricing calculation method will change. The pricing basis for the interest rate level on the repricing day will be changed from the central bank's lending benchmark interest rate to LPR, and the pricing calculation method will be changed to LPR plus points.

LPR is quoted by a representative quoting bank based on the bank's loan interest rate for the best customers, plus points on the open market operating interest rate (mainly referring to the medium-term lending facility interest rate). It is quoted by the Chinese People's The bank authorizes the National Interbank Funding Center to calculate and publish the basic loan reference interest rate. Financial institutions should mainly refer to the LPR for loan pricing.

Currently, LPR includes two varieties: one-year term and more than five-year term. LPR has a high degree of marketization and can fully reflect the supply and demand of funds in the credit market. Using LPR for loan pricing can promote the formation of market-oriented loan interest rates and improve the transmission efficiency of market interest rates to credit interest rates.

The loan market quoted interest rate (LPR) is quoted by a representative quoting bank based on the bank's loan interest rate for the best customers, using the open market operation interest rate plus points. It is authorized by the People's Bank of China nationwide. The basic loan reference interest rate calculated and published by the Interbank Funding Center.