22/01/2015 07:22
The depositors were the main losers of the Central Bank’s previous intervention to reduce interest rates, StockWatch analysis shows.
The figures given by the central bank, show that the last time CB announced measures towards the reduction of deposit rates in April 2013, there was an immediate impact on deposit rates as they decreased from 3,67% in April 2013 to 2,5% in May 2013.
They reached a minimum of 2,18% four months after the announcement and gradually increased since then fluctuating in a rather narrow range of 2,2% - 2,67%. As of November 2014 they stood at 2,59%.
The immediate impact of CB's move on housing loans was their decline by 57 basis points in May 2013.
But they very quickly recovered to the previous level and gradually managed a decrease to 4,74% by November 2014.
During the time under examination the spread between the deposit rate and the housing lending rate increased as shown in the table.
Regarding business loans there was no meaningful immediate impact on the accompanied lending rates as in the month following the decision they decreased by just 17 basis points.
In November 2014 they stood at 5,83%.
For the 19 month period under examination the overall impact of the CB's decision was a decrease in deposit rates by 1,08%, in housing loan rates by 0,85% and in business loan rates by 0,67%.
Since the magnitude of the decline of lending rates was smaller than that of deposit rates the interest margin for banks improved during this period.
It seems that as a result of the CB's decision the main beneficiary were the banks while loan holders benefited at a lesser degree with depositors being negatively affected.
The impending CB's new measures announced by the governor yesterday will take place under a rather difficult economic environment as, given the current negative developments with the economic adjustment program, the risk of deposits fleeing the country are not negligible.
The figures given by the central bank, show that the last time CB announced measures towards the reduction of deposit rates in April 2013, there was an immediate impact on deposit rates as they decreased from 3,67% in April 2013 to 2,5% in May 2013.
They reached a minimum of 2,18% four months after the announcement and gradually increased since then fluctuating in a rather narrow range of 2,2% - 2,67%. As of November 2014 they stood at 2,59%.
The immediate impact of CB's move on housing loans was their decline by 57 basis points in May 2013.
But they very quickly recovered to the previous level and gradually managed a decrease to 4,74% by November 2014.During the time under examination the spread between the deposit rate and the housing lending rate increased as shown in the table.
Regarding business loans there was no meaningful immediate impact on the accompanied lending rates as in the month following the decision they decreased by just 17 basis points.
In November 2014 they stood at 5,83%.
For the 19 month period under examination the overall impact of the CB's decision was a decrease in deposit rates by 1,08%, in housing loan rates by 0,85% and in business loan rates by 0,67%.
Since the magnitude of the decline of lending rates was smaller than that of deposit rates the interest margin for banks improved during this period.
It seems that as a result of the CB's decision the main beneficiary were the banks while loan holders benefited at a lesser degree with depositors being negatively affected.
The impending CB's new measures announced by the governor yesterday will take place under a rather difficult economic environment as, given the current negative developments with the economic adjustment program, the risk of deposits fleeing the country are not negligible.
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