- base rate
Also known as the repo rate. The rate set by the Bank of England which determines how much other banks and building societies pay for loans they take out from the Bank of England. The base rate in turn affects the minimum rate at which banks are prepared to lend money. It acts as the benchmark for other interest rates, including personal loans, overdrafts and mortgages. The Bank of England meets monthly to decide at what rate the base rate should be set.+ base rateUSAA floating interest rate reference rate used by a lender under a loan agreement. The borrower may pay interest on a loan to a lender from time to time at the base rate plus an agreed applicable margin. In general terms, the base rate is the rate per annum equal to the greatest of:• The prime rate (the variable annual rate of interest so designated from time to time by that lender in the US as its "prime rate");• 0.50% above the federal funds effective rate; and• 1.0% above the Eurodollar rate for a Eurodollar rate loan with a one-month interest period.Related links
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.