Information Regarding CIBC’s Prime Rate for Mortgages - Best Mortgage Rates

When looking for a mortgage, the prime rate might not be a term you are familiar with. It is important to educate yourself to get the best rates possible.

CIBC Prime Rate Overview

The prime rate is known as the lending rate that the majority of banks and financial institutions in Canada use to set standard interest rates for lines of credit, variable loans, and mortgages. The price rate of CIBC is currently sitting at 3.95%.

Generally, as with other banks, CIBC only adjusts its prime rate in response to the interest rate policy of the Bank of Canada (BoC). CIBC must change its prime rate by the same amount when the BoC increases or lowers the key rate (known as the overnight rate target). For example, if the BoC increased the overnight rate by 25 basis points (bps), CIBC will typically also increase its prime rate by 25 bps.


As with many things, there have been a few exceptions to this rule. When the BoC lowered interest rates by 25 bps, CIBC only reduced theirs by 15 bps, just like many of the other big banks in Canada. It is very out of the ordinary for a bank to adjust its prime rate independent of BoC. Adjustments to the prime rate are known to happen at any time.

Does The Prime Rate Have An Effect On Mortgage Rates?

The interest rate will be expressed as the CIBC prime rate, plus or minus a certain percentage point when you receive a variable mortgage from CIBC. An example of this is that if the CIBC prime rate is 3.00%, and your mortgage rate is prime minus 0.50%, your mortgage rate is 2.50%.

So, if CIBC changed its prime rate, it would increase your mortgage rate by the same amount. For example, if the CIBC prime rate went up to 3.25%, the mortgage rate will increase to 2.75%.

This rule does not apply to fixed mortgage rates. When you accept a fixed-rate loan, the mortgage rate will not adjust over the whole duration of the term. In the event that rates go up, it mitigates your risk, because your price will not increase. However, you won’t enjoy the added benefit if the rates go down. Fixed rates are better if you think mortgage rates are going to increase, or if you want the added security in knowing exactly which price you’re going to pay regardless of what’s going on in the market.

Check out CIBC Prime Rate and other CIBC Mortgage Rates Here.