Open Data Albania has conducted a research work on the interest rate for deposits and loans in Albania based on data from the Bank of Albania for the past ten years.
The loan interest rate is an indicator of the average interest rate for loans granted by commercial banks for different periods. While the deposit interest rate is an indicator of the average interest rate on deposits placed in commercial banks for different periods.
The trends of these rates in the last decade are given in the following graphic:
Source: Bank of Albania
Analysis and comments: ODA
In January 2011, the average interest rate for loans in Albanian lek (ALL) lasting 1 to 3 years was 17%, while the average rate for the 1-year deposit in ALL was 6%. Gross margin return on the difference between the interest rates of commercial banks is 11% for 1-year periods. This difference has changed continuously over the decade, reaching a maximum of 17% in August 2004, and a minimum value of 6% in July 2009.
The difference between the average interest rate for loans and deposits in the local currency constitutes the gross profit of commercial banks from basic activities. Assuming a sufficient level of competition, at a time when economic environment is uncertain this difference tends to grow, and in case of a safer environment it decreases.
Meanwhile, the average interest rates for loans and deposits in euro (EUR) have changed as follows:
Source: Bank of Albania
Analysis and comments: ODA
In January 2011, the average interest rate for loans in EUR lasting 1 to 3 years was 8%, while the average rate for 1-year deposits in euro was 3%. Gross margin return on the difference between the interest rates of commercial banks is 5% for 1-year periods. The difference has reached its maximum value of 12% in February 2002, and the minimum value of 1% in May 2009.
Average interest rates for loans and deposits in U.S. dollars (USD) have evolved as follows:
Source: Bank of Albania
Analysis and comments: ODA
In January 2011, the average interest rate for loans in USD lasting 1 to 3 years was 7%, while the average rate for 1-year deposit was 2%. Gross margin return on the difference between the interest rates of commercial banks is 5% for 1-year periods. The difference has reached the maximum value of 10% in June 2010, and the minimum value of 0% in January 2009.
