Interest rates on loans in Bulgaria are falling
Mortgage loans are record cheap
In most EU countries, the yield on deposits is higher
There is a decline in all of them
Interest rates on loans for households in Bulgaria continue to decrease, despite the decisions of the European Central Bank to raise the main interest rates. As a result, interest rates on mortgage loans in Bulgaria reached a new record low value.
In September, the annual interest rate (APR) on home loans, which includes all bank fees and commissions in addition to interest, decreased to 2.66%, the BNB announced. This is 0.10% less in the direction of the price of mortgages in the previous month and 0.27% in the amount from September last year. Housing loans granted in September amounted to BGN 520.9 million, which is 21.6% more than the same month last year. But ahead of the previous month, there was a 7.9% drop in mortgage loans granted.
Banks lower interest rates on consumer loans as well. In September, the annual rate of consumer loan expenses was 8.76%, the BNB reported. This is a decrease of 0.02% compared to the previous month and 0.16% compared to the annual basis. The decrease in interest rates is due to the great competition between banks and their desire to attract customers. Consumer loans granted by the banks in September amounted to BGN 647.5 million. This is 23.7% more than the last month of the last year, but compared to the previous month it fell by 11.5%. Obviously, the high inflation earned, a number of households prefer to limit their debts.
While loans to households continue to become cheaper, interest rates on loans to businesses are rising slightly. In September, interest rates on BGN business loans up to EUR 1 million increased by 0.17% to 3.04%, and interest rates on small loans in EUR increased by 0.83% to 3.49%. Interest rates on large corporate loans are also rising. For BGN loans in the amount of more than EUR 1 million, the interest rates increase by 0.28% to 2.50%, and for those in euros – by 1.07% to 3.14%. There is a decline in the total volume of company loans granted in September, as well as in household loans.
Interest rates on citizens’ deposits in September were 0.27% for levs and 0.30% for those in euros, BNB data show. In most EU countries, the interest rates on citizens’ deposits are higher than in our country, and the interest rates on loans are lower. The average interest rate on household deposits with a term of one to two years in the eurozone countries is 0.81%, according to ECB data. For citizens’ deposits up to one year, the highest interest rates are in the Netherlands (1.53%), Italy (0.88%), France (0.84%) and Estonia (0.83%).