Deposit, loan interest rates register slight decreases

TIRANA, August 13 – Interest rates for deposits and loans in the national currency, lek, and euro registered slight decreases in the second quarter of 2010.
Bank of Albania data show interest rates for deposits in lek during April-May period registered 5.14 percent, 0.23 percentage points less than the average of the first quarter.
The drop was not only a result of the year-end promotional campaigns (which lasted until February), but also because of the stabilization of liquidity and a drop in risk premiums.
The average interest rate in April-May 2010 fell by 0.15 percent compared to the same period last year when the repo rate was lowered by 0.5 percent.
Interest rates for time deposits in euro also had a declining trend. Their average interest rate in April and May registered 2.28 percent, 0.11 percentage points below the first quarter average.
Meanwhile, lending interest rate in lek dropped by 0.81 percent in April reaching 13.32 percent but further increased to 13.81 percent in May.
Commercial banks continued favouring lending in lek for individuals buying real estate.
Lending rates in euro continued their falling trend even in the April-May period, averaging at 7.52 percent, the same to the first quarter. Banks continued to hesitate giving loans in euro with a deadline of more than five year for real estate and investments. The interest rate for these kinds of loans rose by 1 percent compared to the first quarter.
According to central bank data, lending in lek accounts for only around 30 percent of the total loans.