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Monday, June 26, 2017

Volume of new bank loans in Estonia reaches highest level in recent years

The volume of new bank loans to businesses in August reached its highest level in recent years, according to the Bank of Estonia.

During the month, banks granted $472 million worth of long-term loans and leases, almost double the amount of a year ago and close to the levels seen in the spring of 2008.

The loans were largely for financing infrastructure but were also used for real estate, industrial production and trading.

The total volume of loans and leases to companies grew during the month by $73 million while the annual growth rate accelerated from 2.4 percent to 2.8 percent.

Interest rates on loans have remained unchanged this year - the average interest rate for housing loans granted in August was 2.6 percent and was 3 percent for long-term corporate loans.

The share of loans overdue by more than 60 days in the loan portfolio fell during the month from 2.8 percent to 2.7 percent, while annual growth in deposits remained at 3 percent.