Credit for people up due to reduced interest rates

Chisinau, 4 August /MOLDPRES/- New loans granted by commercial banks to businesses and individuals continued to increase in the second quarter of 2018. First Deputy Governor of the National Bank of Moldova Vladimir Munteanu announced that in April-June the new loans amounted to almost 5 billion lei. The highest growth was recorded in consumer loans and loans to purchase real estate.

According to BNM, the 17.6 percent increase in new loans in national currency granted by banks in the second quarter compared to the first three months of the year, was due to continuous decrease in interest rates. The average interest rate on bank loans in April -June dropped to 8.78 percent annually compared to 9.52 percent in the first quarter.

The BNM first deputy governor noted that the downward trend in the interest rate is a reaction to the monetary policy decisions of the central bank.

Interest rates on new loans for people, especially those with personal needs, decreased more than the financing contracted by economic agents. Thus, the interest rate on consumer credit dropped from 9.01 percent in January to 7.54 percent in June, on loans for real estate - from 7.53 percent to 7 percent, while companies and other economic entities contracted loans in June at an average interest rate of 9.26 per cent annually against 10.20 per cent in January.

“The volume of credits granted by the banking system to the national economy after a continuous decline for two and a half years registered an increase of 792 million lei in the second quarter compared to the previous one. In fact, the population is the engine of bank lending growth. Consumption and mortgage contributed 53% to the total increase in the loan portfolio. Trade and food industry continue to reduce loans already the fifth year in a row,” economist Veaceslav Ionita said.

(Reporter V. Bercu, editor L. Alcază)