HSBC Denies Mortgage Rate Hike Amid Customer Letters

HSBC Malta has denied plans to increase mortgage interest rates, despite sending letters to some customers advising them of a rate change. The bank stated that it had made no decisions to raise its mortgage interest rates, contradicting suggestions that the European Central Bank's recent interest rate hike was the reason for the change.

The letters, which were sent days after the ECB announced an increase in interest rates, described how the customer's interest rate is calculated: HSBC's Home Loan Base Rate of 2.25% plus an additional margin of 0.50 percentage points. This results in a total rate of 2.75%, but it does not necessarily mean that borrowers will pay more than before.

HSBC explained that individual mortgage rates can change without the bank announcing a general increase, such as when an introductory fixed-rate period expires. However, the bank has yet to explain why the letters referred to a change or what revision had been introduced.

In related news, Bank of Valletta (BOV) has confirmed that its home-loan base rate will remain at 2.15% through December. BOV cited its strong financial position, customers' interests, the economic outlook, and competitiveness as reasons for maintaining stability.