Central bank data show deposits grew by 6.3 percent in 2012 while lending decelerated to 2.3 percent
TIRANA, March 5 – While domestic consumption and investments remain sluggish preventing the country’s economic recovery, Albanians continue depositing considerable amounts in banks uncertain about their futures and fearing a possible escalation of the crisis. Meanwhile, lending has almost frozen after growing by an average of 10 percent in the past three years compared to the pre-crisis levels of 30 to 50 percent. Central bank data show deposits grew by around 56 billion lek (Euro ) to 937.4 billion lek in 2012, registering a 6.36 percent increase, sharply lower compared to 11.7 percent in 2011 and 18.5 percent growth rate in 2010, but better compared to 2008 and 2009 at 2.2 percent and 6 percent respectively.
Lending sharply decelerated to 2.36 percent at the end of 2012, down from 12 percent in 2012. In the global crisis year of 2009 credit growth slowed down to 11 percent and decelerated to 9.6 percent in 2010, according to Bank of Albania data.
Lending to businesses grew by only 3.15 percent to 401 billion lek while credit to individuals returned to positive growth rates but grew by only 0.46 percent.
Banks continued tightening lending standards for businesses in the final quarter of 2012 despite demand by small and medium-sized enterprises registering a considerable increase, according to a quarterly survey published by the Bank of Albania.
Bad loans at a record 22 percent and falling demand by both businesses and individuals for new loans have considerably affected credit growth which is struggling to preserve its growth rates, registering the lowest rates in the past decade.
Latest data available shows that the ratio for loans and deposits denominated in Albanian lek represented 39 percent of total loans and 50 percent of total deposits respectively.
Central bank data show deposits grew by around 193 billion lek (Euro 1.35 bln) to 881.3 billion lek in 2011, registering an 11.7 percent increase, lower compared to the 18.5 percent growth rate in 2010, but better compared to 2008 and 2009 at 2.2 percent and 6 percent respectively.
Data show the overwhelming majority of 95 percent of Albanian depositors have managed to save up to 2.5 million lek (Euro 17,667, USD 22,737) which is the threshold making them fully safe and guaranteed by the Deposit Insurance Agency. The remaining 5 percent of depositors having more than 2.5 million lek in their bank accounts possess around 58 percent of the total amount of deposits in the 16 commercial banks operating in Albania, according to data presented in the annual report of the Deposit Insurance Agency. The data reconfirm the deep social gap between the rich and the poor. Average deposits for the rich stand at 55,000 USD while the average savings for the overwhelming majority is at around USD 2,000.
