We study the expected credit risk spread, i.e., the component of the interest rate of a bank loan, which is designed to compensate the investor for the estimated risk of default of the debtor. We impose a series of technical assumptions that realistically reflect the practice of Banks extending credits to households and demonstrate that the generic interest rate is an increasing function of the loan’s term. Although this dependence might seem somewhat counterintuitive, it is, nonetheless confirmed through empirical analysis.