The Mortgage Credit Directive (2014/17/EU) (MCD) requires that creditors create two illustrative examples for variable rate mortgages on the basis of a benchmark rate specified by the EBA. Consequently, the EBA has developed a draft formula with which creditors are to calculate the rate. By producing a formula instead of a single rate, the EBA aims to ensure that its rate is representative of national circumstances. Annex II to the MCD sets out instructions for creditors when completing the European Standardized Information Sheet, including how to calculate the illustrative example of the annual percentage rate of charge (APR) and the illustration of the installment amount.

On October 12, 2015, the EBA published a consultation paper (EBA/CP/2015/16) on its proposed benchmark rate under the MCD. The consultation is open until November 20, 2015. The EBA intends to publish the final benchmark rate in the first quarter of 2016.