Costa Rica’s Basic Passive Rate decreases 0.25 percent
Costa Rica’s Basic Passive Rate (BPR) decreased from 10.25 to 10 percent on Thursday after remaining above 10 percent for more than three months.
On Oct. 25, President Laura Chinchilla expressed “concern about the high interest rates paid in the country and the effects on Costa Rican finances.” The government initiated a monitoring process, which prompted public banks to lower average rates.
BPR is used by banks to calculate loan rates, mainly housing loans. This means that the increase or decrease in the BPR affects a loan’s monthly payments.
Vice President Luis Liberman said he was satisfied with the reduction, and “the implications are very important for Costa Ricans, because each quarter point less in BPR means an annual reduction of some ₡15 billion [$30 million] for Tico debtors.”
“A family with a housing debt of ₡15 million [$300,000] would have a reduction in their monthly interest of some ₡4,000 [$8],” Liberman said.
The reduction, however, will not be noticeable for debtors until next year, while banks adjust their rates, and it affects those with savings in dollars, as interest rates will also decrease.
The BPR is an average of the interest rates of private and public banks and non-banking financial companies. It is calculated with all deposits in local currency received within six months and the average rate of a joint auction between the Central Bank and the Finance Ministry. It takes into account available balances of up to six months of each of the banks and companies included in the calculation.
In November 2011, the BPR was 8.25 percent.
You may be interested
Costa Rica coronavirus updates for Friday, September 25Alejandro Zúñiga - September 25, 2020
Costa Rica announced 17 new coronavirus-related deaths over the last day for a total of 812, according to official data…
Authorities tell Ponderosa Adventure Park to stop animal reproduction, feeding tours, selfiesAlejandro Zúñiga - September 25, 2020
The National System of Conservation Areas, part of the Environment Ministry, has informed Ponderosa Adventure Park in Guanacaste that it…