News Column

Cyprus still has highest loan rates

August 1, 2014

By Elias Hazou

IN JUNE, Cyprus still had the highest interest rates on new loans for businesses and housing in the eurozone, despite the downward trend recorded in recent months, according to data released on Thursday by the European Central Bank (ECB) and the Central Bank of Cyprus (CBC). This was despite the fact that most categories of lending rates to households fell, with the interest rate on consumer loans dropping from 6.06 per cent in the previous month to 5.74 per cent the lowest since 2009, according to CBC data. By contrast, the interest rate on loans for house purchases rose to 4.40 per cent from 4.37 per cent the previous month, and is still the highest among eurozone countries. The second highest rate for house purchases in the euro area was recorded in Slovakia at 3.36 per cent, and the lowest in Finland with 1.83 per cent, according to the ECB. The main categories of interest rates on business loans also registered decreases. The rate on loans for amounts over 1m dropped to 5.50 per cent from 5.55 per cent, but is still the highest in the euro area. The second highest rate was in Greece at 4.56 per cent and the lowest in Luxembourg with 1.42%. Business loans here on amounts below 1m were also the most expensive among the eurozone, despite dropping to 6.02 per cent from 6.14 per cent. The interest on deposits by households with an agreed maturity of up to one year rose to 2.56 per cent from 2.49 per cent the previous month.

It is the highest deposit rate for households in the eurozone, the second highest rate in Greece at 2.36 per cent. Meanwhile, the deposit rate for businesses fell to 2.39 per cent from 2.50 per cent the previous month.

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Source: Cyprus Mail

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