Commercial banks of Moldova provide by two billion more new loans in Moldovan lei in first four months of 2019 against previous year

Chisinau, 22 May /MOLDPRES/ - Commercial banks provided new loans in national currency worth 1.7 billion lei to residents and economic agents in the first four months of 2019, which is by about two billion lei more against the same period of the year before. The cut in the interest rate stimulates the demand for banking credits, the National Bank of Moldova (BNM) has said.

The demand for bank credits has strongly increased and reached a value of two billion lei in last April, after a constant growth in the last fourth months, from 1.45 billion lei in January 2019. The demands for loans is stimulated by the cut in the interest rate at financings in Moldovan lei, which in last April decreased to a historical minimum level of 8.08 per cent annually, against nine per cent in the same period of the previous years, BNM’s data shows.

About a half of the loans offered by banks were borrowed by residents. In April 2019, the credit for private persons reached the historical maximum of one billion lei, in conditions when the interest rate dropped to the historical minimum of 7.32 per cent. The biggest increase was registered in consumption loans. In April 2019, residents borrowed from banks for personal needs loans worth 589.5 million lei at an interest rate of 7.11 per cent.   

„The degree of indebtness of households in 2018 reached 9.2 per cent of the Gross Domestic Product (GDP) and in 2019, it will get close to 11 per cent of the GDP, which is fivefold more against 15 years ago,” economist Veaceslav Ionita said. At the same time, Ionita noted that degree of indebtness of households was six-fold smaller than the European average size and almost twice smaller than the average of the countries from the region.     

In fact, following the 2014 crisis, private persons have become the main client of the entire financial system and this tendency will be maintained next years as well,” the economist also said.

The average rate of interest on new credits, provided in hard currency, on the concerned period stood at 4.33 per cent. Amid the cheapening of the loans in Moldovan lei, economic agents and residents in April 2019 borrowed loans in hard currency in the equivalent sum of 956 million lei, which is twice less than in the national currency.