Updated: 08 May 2022 16:44

Only one Bermuda bank has taken action since the largest interest rate hike by the Federal Reserve in more than two decades.

The mid-week 50 basis point hike in the US federal funds rate led to near immediate action by Butterfield Bank, raising its interest rates on selected loans and deposits on Thursday.

The Fed should consider further rate hikes in the future.

Both Bermuda Commercial Bank and HSBC Bermuda continued to deliberate on their course of action.

Bermuda Commercial Bank said: “As a Bermuda bank serving both local and international clients, the US Federal Funds Rate is one of many factors we consider in the composition of our rate reviews. deposit and loan. “We will continue to review these rates and should there be any changes, we will notify the community. At Bermuda Commercial Bank, we strive to provide the best solutions for our customers to achieve their financial goals.

Nothing yet from Clarien Bank, but HSBC Bermuda said it also considered factors other than Fed rates in the Bank’s ongoing lending and savings rate reviews.

They said: “No decision has been made on loan rates and should there be a decision in the future it will be communicated through our usual channels.”

Meanwhile, Butterfield said the base rate on their residential Bermuda dollar mortgages, consumer loans, business loans and U.S. dollar loans were raised by half a percent immediately.

Bermuda’s residential mortgage rate increase will take effect on August 5th.

Selected deposit rates with terms of 90 days or longer will be increased in line with market rates.

The Fed decided to start reducing its holdings of Treasury securities, agency debt and agency mortgage-backed securities on June 1, as outlined in plans to reduce the size of the Reserve’s balance sheet. federal government, which were released together with their statement.

The federal funds rate is the central interest rate in the US financial market. It influences the rate that banks charge their customers with higher credit ratings (prime rate) and also longer term interest rates such as mortgages, loans and savings.

Banks are studying last week’s rate hike by the Federal Reserve Board. Butterfield, so far, is the only bank in Bermuda to act