How to determine new interest rate

The new interest rate after review will be based on the base interest rate as of the month preceding the interest rate change date and will be effective from the day following the rate change date.

How to determine the base interest rate

The base interest rate is the Bank's standard interest rate for secured loans to individual customers and is determined by taking into account the cost of funds (the cost required for the Bank to finance the loans), operating costs, and revenues. The most significant variable factor is the cost of funds, which rises and falls in tandem with such indicators as trends in long-term interest rates traded among banks in the months prior to the base interest rate change date and trends in government bond yields, etc.

Interest rate change date

Customers with floating rate plan (1 year renewal)

  • The initial interest rate change date will vary depending on the loan disbursement date and bonus repayment months selected by the customer. Please refer to the table below.
    After the initial interest rate change date, the interest rate change date will be the same as the initial interest rate change date of the year.
  • "Date of interest rate revision" on the Loan repayment schedule details is the date on which the new interest rate will be applied (a day after the interest rate change date in the table below).
  • The debit of the repayment amount, to which the new interest rate is applied, will begin in the month following the interest rate change date.
Repayment method
and/or bonus repayment months		 Initial interest rate change date
Loan disbursement date:
from January 1 to August 31		 Loan disbursement date:
from September 1 to December 31
Monthly repayments only or with increased bonus repayment months of December/June Dec 26 of the current year Dec 26 of the next year
with increased bonus repayments months of January/July Jan 26 of the next year Jan 26 of the year after next
with increased bonus repayments months of February/August Feb 26 of the next year Feb 26 of the year after next

(e.g.)

  1. Monthly repayments only or with increased bonus repayments months of December/June
    <In the case of loan disbursed on August 1, 2024> Initial interest rate change date : December 26, 2024
    <In the case of loan disbursed on September 1, 2024> Initial interest rate change date : December 26, 2025
  2. With increased bonus repayments months of February/August
    <In the case of loan disbursed on August 1, 2024> Initial interest rate change date : Feburary 26, 2025
    <In the case of loan disbursed on September 1, 2024> Initial interest rate change date : Feburary 26, 2026

Customers with fixed rate plan

  • The initial interest rate change date will vary depending on the fixed rate period, loan disbursement date and bonus repayment months selected by the customer. Please refer to the table below.
    After the initial rate change date, unless specifically requested by the customer, the loan interest rate will be automatically switched to a fixed rate with a 1 year renewal.
    If the customer chooses another fixed rate period pursuant to the prescribed procedures, the corresponding date after the expiry of the chosen fixed rate period (number of years) will serve as the next interest rate change date, and the same shall apply subsequently.
  • The debit of the repayment amount, to which the new interest rate is applied, will begin in the month following the interest rate change date.
  • "Notice of end of fixed interest rate period" will be sent to customers with fixed rate plan, 2 months prior to the interest rate change date.
    Please refer to the Information Memorandum of each loan for the details.

With 3 year term fixed rate plan

Repayment method
and/or bonus repayment months		 Initial interest rate change date
Loan disbursement date:
from January 1 to August 31		 Loan disbursement date:
from September 1 to December 31
Monthly repayments only or with increased bonus repayment months of December/June Dec 26 in 2 years Dec 26 in 3 years
with increased bonus repayments months of January/July Jan 26 in 3 years Jan 26 in 4 years
with increased bonus repayments months of February/August Feb 26 in 3 years Feb 26 in 4 years

With 5 year term fixed rate plan

Repayment method
and/or bonus repayment months		 Initial interest rate change date
Loan disbursement date:
from January 1 to August 31		 Loan disbursement date:
from September 1 to December 31
Monthly repayments only or with increased bonus repayment months of December/June Dec 26 in 4 years Dec 26 in 5 years
with increased bonus repayments months of January/July Jan 26 in 5 years Jan 26 in 6 years
with increased bonus repayments months of February/August Feb 26 in 5 years Feb 26 in 6 years

With 7 year term fixed rate plan

Repayment method
and/or bonus repayment months		 Initial interest rate change date
Loan disbursement date:
from January 1 to August 31		 Loan disbursement date:
from September 1 to December 31
Monthly repayments only or with increased bonus repayment months of December/June Dec 26 in 6 years Dec 26 in 7 years
with increased bonus repayments months of January/July Jan 26 in 7 years Jan 26 in 8 years
with increased bonus repayments months of February/August Feb 26 in 7 years Feb 26 in 8 years

With 10 year term fixed rate plan

Repayment method
and/or bonus repayment months		 Initial interest rate change date
Loan disbursement date:
from January 1 to August 31		 Loan disbursement date:
from September 1 to December 31
Monthly repayments only or with increased bonus repayment months of December/June Dec 26 in 9 years Dec 26 in 10 years
with increased bonus repayments months of January/July Jan 26 in 10 years Jan 26 in 11 years
with increased bonus repayments months of February/August Feb 26 in 10 years Feb 26 in 11 years

(e.g. Fixed rate plan (10 year term))

  1. Monthly repayments only or with increased bonus repayments months of December/June
    <In the case of loan disbursed on August 1, 2024> Initial interest rate change date : December 26, 2033
    <In the case of loan disbursed on September 1, 2024> Initial interest rate change date : December 26, 2034
  2. With increased bonus repayments months of January/July
    <In the case of loan disbursed on August 1, 2024> Initial interest rate change date : January 26, 2034
    <In the case of loan disbursed on September 1, 2024> Initial interest rate change date : January 26, 2035

FAQ regarding interest rate changes

Q I want to know the interest rate and repayment amount after the interest rate change.

A You can check them on the loan repayment schedule details.

Please check here to find out when the schedule details will be sent to you.

Q Will "5 year rule" or "125% rule" be applied to a floating rate plan (1 year renewal)?

A No, those rules will not be applied to loans offered by SMBC Trust Bank.

If the borrowing rate changes, the debit of the repayment amount will be adjusted accordingly.

  • "5 year rule" ...
    A rule in which the debit of the repayment amount remains the same for 5 years even if the borrowing rate changes,
    by reviewing the principal and interest amount breakdown of the repayment amount.
  • "125% rule" ...
    A rule in which the repayment amount, which will be changed based on the "5 year rule," is limited to 125% of the previous repayment amount.

Q How can I apply to change from the floating rate plan (1 year renewal) to a fixed rate plan or re-select a fixed rate plan?

A Please apply by calling us at the contact information shown below.

Please note that switching from a fixed rate plan to a floating rate plan is not possible.
To check the fee for changing the rate plan, please check here.

Q How is the base interest rate determined?

A The base interest rate is the Bank's standard interest rate for secured loans to individual customers and is determined by taking into account the cost of funds (the cost required for the Bank to finance the loans), operating costs, and revenues. The most significant variable factor is the cost of funds, which rises and falls in tandem with such indicators as trends in long-term interest rates traded among banks in the months prior to the base interest rate change date and trends in government bond yields, etc.

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