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Interest rates
09.03.2020
The Banque centrale du Luxembourg (BCL) informs that, based on preliminary data, the main interest rates applied by Luxembourg’s credit institutions to euro area households and non-financial corporations (NFCs) for their loan and deposit operations have on average evolved as follows in January 2020.
Representative interest rates on new contracts[1] – loans and deposits – concluded with households
The variable[2] interest rate on mortgage loans granted to households has remained broadly stable, reaching 1.41% in January 2020 whereas the volume of these newly granted loans has decreased by 119 million euros to reach 190 million euros. On a yearly basis, the interest rate has decreased by 12 basis points and the volume of newly granted loans has increased by 12 million euros.
The fixed[3] interest rate on mortgage loans granted to households has increased by 6 basis points on a monthly basis to reach 1.37% in January 2020. The volume of these newly granted loans has decreased by 111 million euros on a monthly basis and has consequently amounted to 441 million euros during the last reference period. On a yearly basis, this interest rate has decreased by 48 basis points whereas the volume of newly granted loans has increased by 188 million euros.
The interest rate on consumer loans that have an initial fixation period above 1 year and below or equal to 5 years has decreased by 101 basis points on a monthly basis to reach 1.67% in January 2020 whereas the volume of newly granted loans has increased by 26 million euros to reach 46 million euros. It is worth stressing that these developments result from the financing conditions applied during the traditional car festival. On a yearly basis, the interest rate has decreased by 14 basis points whereas the volume of new lending has increased by 16 million euros.
The interest rate on households’ fixed-term deposits that have an initial maturity below or equal to 1 year has increased by 3 basis points on a monthly basis to reach 29 basis points in January 2020.
Representative interest rates on new contracts1 – loans and deposits – concluded with NFCs
The variable2 interest rate on loans below or equal to 1 million euros granted to NFCs has increased by 10 basis points on a monthly basis to reach 1.69% in January 2020. The volume of newly granted loans has decreased by 27 million euros on a monthly basis, reaching 760 million euros in January 2020. On a yearly basis, this interest rate has decreased by 4 basis points and the volume of newly granted loans has decreased by 106 million euros.
The variable2 interest rate on loans above 1 million euros granted to NFCs has decreased by 3 basis points on a monthly basis to reach 1.08% during the last reference period, whereas the new business volume has decreased by 20 million euros to reach 5 265 million euros. On a yearly basis, this interest rate has decreased by 23 basis points and the volume of newly granted loans has decreased by 1 306 million euros.
The interest rate on fixed-term deposits of NFCs with an initial maturity below or equal to 1 year has reached -5 basis points in January 2020 from 2 basis points in December 2019. On a yearly basis, this interest rate has remained unchanged.
The tables pertaining to interest rates applied to credit institutions can be consulted and/or downloaded on the BCL’s website on the following pages:
http://www.bcl.lu/en/statistics/series_statistiques_luxembourg/03_Capital_markets/index.html
Weighting method
The interest rates applied to new contracts are weighted within the categories of instruments concerned by the amounts of individual contracts. This results from the compilation of national aggregates carried out by reporting credit institutions and by the BCL.
[1] New contracts refer to any new agreement concluded between the household or the non-financial corporation and the reporting agent. New contracts include all financial contracts which mention for the first time the interest rate pertaining to the deposit or credit and all renegotiations of existing deposits or credits.
[2] Variable interest rate or rate with an initial fixation period inferior or equal to 1 year.
[3] Fixed interest rate weighted by the amounts of contracts for all mortgage loans granted, whatever the initial rate fixation period (above 1 year). This series has been published by the BCL since February 2009 only for methodological reasons linked to the identification of reporting agents.
