Fall to Euribor This situation, which started last November, is good news for the industry. mortgagedbut it’s not like that for him protectors. The index, which measures the average lending rate that banks lend to each other, is used in most evaluations. mortgage payments It is expected to start falling in Spain in the coming months. But it also serves as an implicit reference to the interest paid by organizations. deposit. Hence his descent border continues to rise fee that the bank pays for the money it keeps for its customers. And this will also occur in the Spanish financial sector. dragged his feet For months: deposit interest rates have increased less than other times The increase in the European Central Bank’s official interest rates (ECB) and is also one of the ones that increases them the least. eurozone.
Since the ECB started tightening monetary policy December 2021Therefore the monthly average interest rate new term deposits The number of Spanish households increased 0.06% to 2.57% (2.51 percentage points) compared to last November, published this Friday by Bank of Spain. In the same period, euribor a year has passed -0.502% to 4.022% (4,534 points) and average interest on new deposits given to families eurozone increased from 0.23% to 3.33% (3.1 points). As a result, the average rate balance The proportion of household term deposits (not just new operations) increased Spain between 0.04% to 1.8%while in eurozone went from 1.14% to 2.28%.
Expected from the Central Bank start dropping children This year’s official, which the ECB does not want to feed but does not reduce sharply Euribor is falling at a remarkable rate. Actually index Up to one year was in December under in Euribor one, three and six monthsThis only happens when the market expects medium-term interest rate cuts. Twelve-month Euribor fell to 3.679% last month and experts predict it will be even lower by the end of 2024 (3.06% Bankinter and 3.25% CaixaBank), so the margin for further increases in deposit interest is limited.
liquidity problem
Therefore, everything indicates that it will rain instead of getting wet. According to Bank of Spain’s estimates, banks are barely They transferred 3.96% The rise of Euribor to the household term deposit rate between December 2021 and the same month in 2022. In the first half of last year, they accelerated the pace slightly and reached the 2020 TL transfer level. 23.09% last June. However, it is significantly lower 50.74% the institution takes into consideration expected According to historical experience 2003-2019 periodand also about half of the translation was observed on average in the euro area.
In its latest financial stability report, the Bank of Spain cited “a negative initial level of Euribor, excess liquidity system, specific features organizations and market structure However, the increase in average deposit interestmay continue to increase “Given the decrease and increase in the cost of financing from the Eurosystem in the coming months”.
Banks are therefore close to completing the process. come back progress large liquidity injections Cheap debt provided by the ECB during the worst times Pandemic from covid. IT reduces your liquidity level and encourages them to pay more on deposits to maintain their resource levels. But we also need to take into account that the economy is in good shape. slowdownThe demand for loans is also decreasing, and with it the need to collect funds to be allocated to loans is also decreasing.
more expensive loan
evolution loan types nor does it help stimulate demand. Average interest new mortgages In Spain, it increased to 1.38% from 1.38% in December 2021. 3.79% When it was November, rest of credits Household rate from 6.1% 7.45%. Inside eurozonethe increase was 1.31 percent 4.01% and from 5.06% 7.85%, respectively. As a result, the average interest balance The rate of mortgages and other loans given to households in Spain in November. 3.68% and 7.05%In the Eurozone, this figure reached: 2.4% and 5.45%.
This caused: monthly interest bill Wages paid by households have increased by 1 billion 286 million euros since December 2021. from 1.344 million to 2.630 million since last November. On the other hand, interests charged barely increased by 349 million due to families’ deposits and current accounts, 15 to 364 million. This means: monthly margin 937 million for organizations and a 70% improvement was achieved. 2.266 millionAs can be calculated from Bank of Spain data.
An important element to explain this is 87.8% of money what households currently hold in assets existing accountswhose average interest has barely increased 0.02% to 0.15% Since December 2021. But savings were distributed in previous interest rate hike cycles balanced shape between these accounts and deposits representing 50% to 60% of what families hold in banks. That is, even if term deposit interest rates are increased, organizations pay much less It further increased the interest of households compared to similar events in the past. In November, deposit balance increased by 7 billion 987 million accounts It fell by 2.475 million, but the difference between one and the other is still very large (11.9486 million and 866.057 million respectively).