Personal Finance Term
BR
Base Rate
The minimum interest rate at which Malaysian banks can lend, determined by each bank's cost of funds. Variable-rate home loans are priced as Base Rate + spread.
Introduced in 2015 to replace BLR (Base Lending Rate), the Base Rate is supposed to be more transparent — each bank sets its own BR based on its funding cost and statutory requirements, and must publish it. When BNM raises the OPR, banks typically raise their BR within weeks.
A home loan at 'BR + 1.25%' means if the bank's BR is 3.00%, you pay 4.25% p.a. If OPR rises by 25bps and the bank raises BR to 3.25%, your rate becomes 4.50%. The spread (+1.25%) is fixed for the loan tenure. Always check the BR, not just the advertised rate.