Commentary on MFI interest rates

September 2024

Interest rates on new business

Interest rates on new deposits of households recorded the largest change for deposits with agreed maturity in September. As regards non-financial corporations, overnight deposits saw the largest change.

The interest rate on household deposits with agreed maturity declined by 0.11 percentage point to 3.61%. The interest rate on overnight deposits increased slightly to 1.31%. At 0.13%, the rate on current account deposits was the same as in September. The interest rate on deposits redeemable at notice decreased to 2.04% (this rate is the only one to include, in addition to the household sector, also similar deposits of non-financial corporations, whose volumes are negligible in this category).

The rate on deposits of non-financial corporations with agreed maturity fell to 3.79%. The interest rate on overnight deposits decreased by 0.09 percentage point to 1.30%. The interest rate on current account deposits declined to 0.69%. Deposits with agreed maturity of up to one year (which as a rule account for 100% of all deposits with agreed maturity in this sector) were remunerated at a lower rate (3.79%).

Chart 1 – Interest rates of commercial banks on CZK deposits held by Czech residents – new business
Interest rates of commercial banks on CZK deposits held by Czech residents – new business

Source: ARAD data series system

Within interest rates on new loans to households, the biggest change was recorded for other loans and consumer credit in September. Within interest rates on loans to non-financial corporations, the biggest changes were recorded for overdrafts.

The overall interest rate on consumer credit, loans for house purchase and other loans rose to 5.90%. The interest rate on consumer credit decreased by 0.11 percentage point month on month to 8.70%. The interest rate on loans for house purchase fell to 4.92%. The interest rate on building society loans decreased to 5.84%. The interest rate on mortgage loans dropped to 4.86%, down by 0.51 percentage point on a year earlier. The rate on other loans fell by 0.11 percentage point to 5.39%. The interest rate on overdrafts and revolving loans increased to 15.17%. The interest rate on credit cards rose to 17.79%.

Interest rates on new loans to non-financial corporations (excluding overdrafts, revolving loans and credit cards) decreased to 5.97%. The rate on loans of up to CZK 7.5 million fell to 6.42%. The rate on loans of over CZK 7.5 million and up to CZK 30 million fell to 5.79% and the rate on new loans of over CZK 30 million decreased to 5.95%. The interest rate on overdrafts, revolving loans and credit card loans dropped to 6.28%. The interest rate on overdrafts stood at 6.33%, down by 0.23 percentage point.

Chart 2 – Interest rates of commercial banks on CZK loans provided to Czech residents – new business
Interest rates of commercial banks on CZK loans provided to Czech residents – new business

Source: ARAD data series system

Interest rates on outstanding amounts

The average interest rates on outstanding amounts of deposits of households changed by just a few tenths of a percentage point in August. Similar changes were recorded for non-financial corporations.

The average changes in interest rates on outstanding amounts of loans to households were just a few basis points in August. Interest rates on outstanding amounts of loans to non-financial corporations saw larger changes.

The overall interest rate on loans to households increased to 4.35%. The interest rate on loans for house purchase also rose, reaching 3.48% (with the rate on outstanding amounts of mortgage loans picking up to 3.33%). The rate on consumer credit dropped marginally to 8.78% and the rate on other loans increased to 4.69%.

The average interest rate on loans to non-financial corporations fell to 5.72%. The rate on loans with maturity of up to one year decreased to 6.37%. The rate on loans with maturity of over one year and up to five years declined to 6.52%. The rate on loans with maturity of over five years dropped to 5.17%.

Notes: