Finance

Finance

ADB to increase interest rate on loans

12 April 2010 10:38 (UTC +04:00)

Baku. Nijat Mustafayev â€“ APA-Economics. The Asian Development Bank (ADB) will increase its loan rates.

The Bank informs that it has revised its loan charges on new LIBOR-based loans and local currency loans to sovereign borrowers or borrowers with sovereign guarantees negotiated, on, or after, 1 July 2010.

According to bank, under the new loan pricing structure, the effective contractual spread will be adjusted to 0.4% per annum from the current charge of 0.2%. The adjustment will be phased in over 2010 and 2011, with the new sovereign loans negotiated from 1 July 2010 to 30 June 2011 carrying an effective contractual spread of 0.3% per annum, and those negotiated, on, or after, 1 July 2011 carrying an effective contractual spread of 0.4% per annum.

The exact level of ADBâ€™s lending rate can vary because it is determined by the cost of borrowings and the reference floating rate, such as LIBOR.