Interest rates of loans maintain the declining trend even in the first quarter of 2017
Interest rates on new loans in Albanian Lek have fallen further in the first quarter of 2017. According to data from the Bank of Albania, the average interest rate was 7.36% from 7.75% that it was in the last quarter of 2016.
Although on average interest have fallen, their performance by segments recorded some novelty compared to last year.
The interest rates of loans to private businesses has declined, and those for individuals have increased, the latter a segment where the decline of interest rates was more pronounced in 2016.
The average rate on corporate loans resulted 7.33% from 8.03% that it was in the fourth quarter.
Within the business segment, the interest rates on loans have declined for liquidity loans and increased for investment loan.
It seems that the rise in interest rates of treasury bills and bonds in the last months of last year has caused pressure to increase interest rates on long-term loans in general and especially for loans to individuals.
Even the average interest rate on new loans in euro recorded a slight decrease in the first quarter. On average, it was 4.62%, from 4.71% that it was in the previous quarter.
In general, private businesses as well as individuals have benefited from the decline of interest rates on loans in euros.
In the segment of businesses, the decline of interest rates has been observed in loans for liquidity, and interest rates on loans for investment continues to remain at minimal levels.
The difference in the average ratio of loans in domestic currency versus the euro has decreased during the first quarter, as a result of the large decline in interest rates on all loans.
The cut in differences in interest rates favors lending in domestic currency, given that individuals have fewer incentives to take loans in foreign currency, given the fact that they are exposed to the risk of exchange rate.
SCAN
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