How to Calculate Basis Points

How to Calculate Basis Points
Changes in interest rates are often calculated using basis points.

Basis Point Computations

Calculate the number of basis points in an interest rate by multiplying the percentage rate by 100. For example, an interest rate increase of 0.50 percent multiplied by 100 equals 50 basis points. If you want to go in the other direction and convert basis points to a percentage figure, divide the number of basis points by 100. Thus, 125 basis points divided by 100 equals 1.25 percent.