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Home loan costs jump beyond 10% benchmark
The annual percentage rate on Bulgaria’s lev-denominated loans exceeded the 10% level in August picking up 1.32 percentage points year-on-year, central bank data showed. APR added 1.81 points to 12.74% on consumer loans and hit 8.83% on euro-denominated housing loans. Consumer loan rates saw the biggest increase gaining 2.33 points to 11.66%. Local-currency housing mortgages bore an average rate of 9.53%, up 1.18% year-on-year. The rate of euro-denominates mortgage loans was 7.94%, up 0.46 points from last August. Bankers forecast rates will continue to crawl and edge up 0.6-1% in the coming months dulling borrowers’ appetite. Austria’s Raiffeisen Zentralbank projected in its latest analysis that household loan demand will keep up the very high levels in Central and Eastern Europe. Last year southeast European banks outran their central European peers by loan levels growing to 48% of the GDP as consumer loans chopped a bigger portion of their portfolios. In Bulgaria, the average interest rate of lev-negotiated corporate loans of up to EUR 1.0 million rose by 1.67 points to 10.96% in the year to August. Euro-denominated business loans grew 0.22 points costlier reaching 8.92%. Lev-negotiated loans of over EUR 1.0 million came with rates of 11.33%, up 2.32 points against 8.42% for euro-denominated credits. Source: http://news.dnevnik.bg/