A board rate is a home loan interest rate that a bank sets and revises unilaterally — at its own board or management’s discretion — rather than pegging it to a transparent external benchmark like SORA, historically used in Singapore’s fixed-deposit-linked and standard board-rate mortgage packages.
Not financial advice. All figures are for educational reference only. Data as at August 2026. Last updated: August 2026.
On This Page
Table of Contents
- What Is It?
- How It Works in Singapore
- Example
- Advantages
- Risks & Limitations
- Board Rate vs SORA-Pegged Rate
- The Bottom Line
- Frequently Asked Questions
- Related Terms
Key Takeaways
- Board rates are determined internally by each bank, not tied to a published market benchmark like SORA or the now-discontinued SIBOR.
- Because banks can revise board rates at their own discretion (usually with a notice period), they offer far less rate transparency than SORA-pegged loans.
- Since Singapore’s shift away from SIBOR toward SORA-pegged mortgages around 2021-2022, most banks have stopped actively marketing new board-rate packages to new customers — though borrowers on legacy board-rate loans may still be repricing on them today.
- Fixed Deposit Home Rate (FHR) packages, which combine a bank’s own FD rate with a spread, are a semi-transparent hybrid cousin of the pure board rate.
- If you’re on an old board-rate loan, it’s worth comparing your current effective rate against today’s SORA-pegged packages — a stale board-rate loan can quietly become more expensive than the market alternative.
What Is Board Rate (Mortgage)?
Before Singapore’s benchmark reforms, many home loans were priced off either SIBOR (Singapore Interbank Offered Rate), a bank’s own Fixed Deposit Home Rate (FHR), or a pure internal board rate set by the bank’s own board or ALCO (Asset-Liability Committee). A board rate isn’t published or independently verifiable the way SIBOR or SORA are — the bank alone decides the rate and when to change it, typically giving borrowers a notice period as required under their loan agreement.
The Association of Banks in Singapore (ABS), working with MAS, drove the market away from SIBOR toward SORA (Singapore Overnight Rate Average) as the standard mortgage benchmark, culminating in SIBOR’s discontinuation. Board-rate packages, which predate even SIBOR-pegged loans in some cases, fell further out of favour for the same underlying reason: borrowers and regulators increasingly wanted a benchmark nobody could unilaterally move.
How Does It Work in Singapore?
Legacy board-rate loans still exist on many Singapore banks’ books. Borrowers on these loans typically receive periodic repricing letters, and it’s up to the borrower to actively request a switch to a SORA-pegged package or refinance to another bank — the bank generally won’t do this automatically.
From around 2022, MAS and ABS pushed banks to offer SORA-pegged packages as the default, transparent benchmark for new retail mortgages. Board-rate (and FHR) packages have largely been phased out for new sign-ups, but existing loans taken out under the old structure don’t automatically convert — they continue on the board rate until the borrower refinances, reprices, or the loan is paid off.
Example
Consider a borrower on a legacy board-rate mortgage taken out several years ago at an initial promotional rate. Over successive repricing cycles, the bank’s board rate can drift upward — sometimes by more than a comparable SORA-pegged package would have moved over the same period, since there’s no public benchmark forcing the bank’s hand. A borrower who hasn’t reviewed their rate in a few years may find, on checking, that today’s best SORA-pegged packages from other banks are meaningfully cheaper — a gap that’s easy to miss without actively comparing, since board rates rarely make headlines the way SORA movements do.
Advantages
- Can offer attractive short-term promotional pricing. Banks sometimes use board-rate or FHR packages to offer a low initial rate to win new customers, especially when bundled with other products.
- Predictable between revisions. Once set, the repayment amount stays fixed until the bank’s next scheduled repricing, giving short-term certainty.
- Can reward existing relationships. Historically, FD-linked board rates could stay competitive for borrowers who also kept fixed deposits with the same bank, reflecting a “relationship pricing” approach.
Risks and Limitations
- Opacity is the core risk. There’s no public benchmark to check whether your current board rate is fair — the bank can raise it and you have limited immediate visibility into whether that’s in line with the broader market.
- Possible loyalty tax. Some borrowers find banks reprice existing board-rate loans upward more aggressively over time than the promotional rates offered to attract brand-new customers.
- Hard to compare across banks. Since each bank’s board-rate methodology isn’t standardised or published, shopping around for the “best” board rate is far less straightforward than comparing SORA-pegged spreads.
- Lock-in penalties on exit. Refinancing or repricing away from a board-rate loan within its lock-in period can trigger legal fee and subsidy clawback costs.
Board Rate vs SORA-Pegged Rate
| Aspect | Board Rate | SORA-Pegged Rate |
|---|---|---|
| Benchmark | Set internally by the bank | Published daily by MAS (compounded SORA) |
| Transparency | Low — not independently verifiable | High — publicly available and auditable |
| Adjusts with market | At the bank’s discretion | Automatically, tracking SORA movements |
| Prevalence today | Mostly legacy loans; rarely offered to new customers | Standard structure for new Singapore home loans since ~2022 |
The Bottom Line
If your mortgage is still on a board rate, pull out your latest repricing letter and compare it against today’s SORA-pegged packages. The lack of a public benchmark means a board-rate loan can quietly cost more than necessary without you realising it.