What EURIBOR is and how it affects a loan in euro
What EURIBOR represents, how it feeds into the rate on a euro loan, and why the exchange rate matters too.
Published
What EURIBOR is
EURIBOR (Euro Interbank Offered Rate) is the reference rate at which euro-area banks lend to each other in euro. It is published every working day for five terms: one week and 1, 3, 6 and 12 months.
It is administered by the European Money Markets Institute (EMMI) and is calculated, as far as possible, from the real transactions of a panel of European banks.
Why it concerns you
If you have a variable-rate loan in euro, your rate is EURIBOR plus the bank's margin. The contract says which term is used, usually 3 or 6 months, and the rate is updated just as often.
The margin stays fixed. EURIBOR is the only part that moves.
How much it can change
Between 2015 and 2022 EURIBOR was below zero. In 2022 and 2023 it climbed quickly, as the European Central Bank raised rates to slow inflation.
On an 80,000 euro loan over 25 years, the monthly payment is about 422 euro at a total rate of 4%, 468 euro at 5% and 515 euro at 6%. One percentage point is roughly 46 euro a month.
The risk that is easy to forget: the exchange rate
If you earn in lei and pay in euro, you pay more every time the leu weakens, even if EURIBOR does not move. That is why BNR rules cap payments at 20% of income for loans in a currency other than the one you earn in, against 40% for loans in lei.
What you can do
- Check your contract for the EURIBOR term used and the date of the next update.
- Work out the payment at a rate two points higher too, in the payment calculator, with EUR chosen as the currency.
- If you want predictability, compare with a fixed rate.
Monthly EURIBOR averages and their history are on the interest rates page.