Suppose your firm is seeking an eight$-$year, amortizing $$860,000$ loan with annual payments, and your bank is offering you the choice between a loan of $$916,000$ with a compensating balance of $$56,000$ and a loan of $$860,000$ without a compensating balance. The interest rate on the $$860,000$ loan is $8\mathrm{.}5$ percent.

How low would the interest rate on the loan with the compensating balance have to be for you to choose it$?($Do not round intermediate calculations. Round your final answer to $2$ decimal places.$)$

Interest rate