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What is SIBOR?

SIBOR is the acronym for Singapore InterBank Offer Rate. In layman terms, it simply represents the interest rate that Singapore banks charge to lend to each other. SIBOR is regularly used as a reference rate where loans are pegged to. SIBOR is set daily (working days) by the Association of Banks in Singapore and is publicly available on Association of Banks in Singapore website. In general the shorter the time period SIBOR is based on, the lower and more volatile the interest rate. The 3 Month SIBOR rate is currently around 0.44% as compared to the 1 Month SIBOR rate which is around 0.25% with rates accurate as of Jul 2020.

What about Fixed Deposit Linked Rates,
Board Rates, SOR, Combo, etc?

Fixed Deposit Linked rates are reference rates that are based on a bank's fixed deposit rates while Board Rates are rates determined internally by banks based on their own benchmark rates. SOR is the acronym for Swap Offer Rate and is basically the interest rate a borrower will be charged if he or she were to borrow in US dollars while Combo Rate is a combination of SIBOR and SOR.

All of the mentioned rates are reference rates where loans are priced in but SIBOR remains the most popular reference rate for loans to be priced in due to its transparency. Hence, any movement in SIBOR rates is closely monitored as it could affect repayment of loans and also financial markets. It is also worth noting that all these reference rates usually move in tandem with each other in the same direction. See SIBOR vs Fixed Deposit Linked Rates vs Board Rate for a more detailed discussion about how to choose the best reference rate for loan packages.

3 Month SIBOR Rate History Chart

3 Month SIBOR Rate Historical Data for
Past Year

1 Month SIBOR Rate History Chart

1 Month SIBOR Rate Historical Data for
Past Year

Future Direction of SIBOR?

Both chart and data for 3 month and 1 month SIBOR indicates that we have most likely seen a bottom in SIBOR rates in between 2011 and 2014. Borrowers who fear a spike in SIBOR rates or interest rates in general should try to remain prudent and look for fixed interest rate loans to prevent a huge rise in mortgage payments in the event of periods of high interest rates. With interest rates trending downwards in recent months due to various economic and macro uncertainties, we are predicting the period of lower interest rates is set to stay. However, it will be most prudent for borrowers to take into account of higher interest rates when taking a loan so as not to overstretch themselves.