Standardised Base Rate

Beginning from 1 August 2022, all banks in Malaysia used the Standardised Base Rate (SBR) as the reference rate for pricing new retail floating-rate loans, refinancing existing retail loans, and renewing revolving retail loans. Retail loans are loans granted to individuals, while floating-rate loans are those whose interest rates can change over the loan's lifespan. The SBR is linked exclusively to the Overnight Policy Rate (OPR) as set by Bank Negara Malaysia's Monetary Policy Committee (MPC).

The aim of introducing the SBR is to simplify matters for customers. Unlike the Base Rate (BR), which varies by bank, the SBR will be the same for all banks. This makes it easier to compare loans across banks and make informed decisions when choosing a bank for a new floating-rate loan. Changes in the loan repayment amount will occur only due to OPR changes or changes in the borrower's credit risk profile, such as defaulting on payments.

Whenever the OPR changes, banks will adjust the SBR by the same amount. This applies to upward and downward adjustments in the OPR.

Standardised Base Rate / Standardised Islamic Base Rate = Overnight Policy Rate (OPR)

Check the latest SBR on each bank HERE.

Standardised Base Rate (SBR) FAQs

How does the Standardised Base Rate (SBR) impact Consumers?

1. SBR is applicable to conventional loans and Islamic financings priced against a reference/base rate.

2. With effect from 1st August 2022, SBR is applicable to all types of retails loans / financings be it new or refinanced. It is also applicable for renewed loan/financing and revolving credit lines.

What would happen to the current Base Rate (BR) / Islamic Base rate (IBR)?

With effect from 1st August 2022, Base Rate (BR) / Islamic Base Rate (IBR) will move in tandem and at the same quantum with SBR / OPR e.g. if OPR increases by 25bps from 2.25% to 2.50%, then SBR shall increase by 25bps from 2.25% to 2.50%. BR / IBR and BLR / BFR too shall increase by same 25bps from 2.25% to 2.50% and from 5.90% to 6.15% respectively.

What about the existing BR / IBR and BLR / BFR pegged loans / financings?

The interest / profit rate of the existing BR / IBR and BLR / BFR pegged loans/financings shall remain unless there is a change in OPR.

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