Are you sure?

Home lending rates rise, consumer loan rates fall in December

The average lending rate for home loans rose 19bp in December 2006 to 9.80%, while the average rate for consumer loans dropped 28bp to 16.90%, National Bank of Hungary (NBH) figures published on Wednesday show.

The average retail rate for current account overdrafts rose just 2bp to 20.23%. Compared to December 2005, the average rate for consumer loans fell 179bp, while the average rate for home loans rose 83bp. The annual%age rate (APR) - a measure of the total cost of borrowing - for home building loans remained unchanged in December and was practically the same as the average rate in Q4 2006. But the rate was 100bp higher than at the end of 2005. APR for consumer loans, however decreased 114bp in December alone and fell 377bp in a year. The average lending rate for euro-denominated home loans was 4.39% in December, about the same as in September-December, but 42bp higher than in December 2005.

The average lending rate for euro-denominated consumer loans fell 10bp in December to 9.64%, but was 331bp over the rate a year earlier. APR for euro-denominated home loans was 5.85%, 21bp less than in November and 38bp down from a year earlier. APR for euro-denominated consumer loans was 12.42% in December, down 41bp from November and up 308bp from a year earlier. Interest rates on retail deposits fixed for less than one year rose 47bp to 7.37% in December from November. Interest rate for deposits fixed for more than one year grew the same 47bp to 7.40%.

In a twelve-month comparison, average interest rates for deposits fixed for less than one year increased 226bp, while rates for deposits fixed for more than one year rose 168bp. Forint denominated home loan contracts worth Ft 17 billion were signed in December, Ft 2 billion less than in November but Ft 1.6 billion more than in the same month one year earlier. Consumer loans of Ft 22.9 billion were taken out in December, Ft 1.2 billion more than in the preceding month and Ft 3.7 billion less than a year earlier. Fresh retail deposits worth Ft 533 billion were fixed for more than one year, Ft 85 billion more than in November and Ft 151 billion less than in December 2005. Retail sight deposits of Ft 1,343 billion were placed with banks in December, Ft 63.5 billion more than in the preceding month and Ft 104 billion less than in December 2005. (Bloomberg)