Commentary on MFI interest rates

July 2024

Interest rates on new business

Interest rates on new deposits of households and non-financial corporations recorded the largest change for deposits with agreed maturity in July.

The interest rate on household deposits with agreed maturity declined by 0.37 percentage point to 3.93%. The interest rate on overnight deposits fell to 1.37%. The rate on current account deposits rose to 0.24%. The interest rate on deposits redeemable at notice decreased to 2.20% (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 by 0.45 percentage point to 4.11%. The interest rate on overnight deposits rose slightly, to 1.46%. The interest rate on current account deposits declined to 0.79%. 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 (4.11%).

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 credit cards in July. Interest rates on loans to non-financial corporations saw the largest change for overdrafts, revolving loans and credit cards.

The overall interest rate on consumer credit, loans for house purchase and other loans fell to 6.01%. The interest rate on consumer credit rose month on month to 9.01%. The interest rate on loans for house purchase fell to 4.88%. The interest rate on building society loans decreased to 5.94%. The interest rate on mortgage loans dropped to 4.79%, down by 0.56 percentage point on a year earlier. The interest rate on other loans dropped to 5.45%. The interest rate on overdrafts and revolving loans rose to 15.09%. The rate on credit cards stood at 17.66%, down by 0.20 percentage point.

Interest rates on new loans to non-financial corporations (excluding overdrafts, revolving loans and credit cards) decreased to 6.59%. The rate on loans of up to CZK 7.5 million was down to 6.78%. The rate on loans of over CZK 7.5 million and up to CZK 30 million fell to 6.14% and the rate on new loans of over CZK 30 million decreased to 6.64%. The interest rate on overdrafts, revolving loans and credit card loans decreased by 0.34 percentage point to 6.69%. The interest rate on overdrafts declined to 6.79%.

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 July. 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 July. Interest rates on outstanding amounts of loans to non-financial corporations saw larger changes.

The overall interest rate on loans to households increased to 4.30%. The interest rate on loans for house purchase also rose, reaching 3.42% (with the rate on outstanding amounts of mortgage loans picking up to 3.27%). The rate on consumer credit edged up to 8.79% and the rate on other loans was unchanged at June’s 4.68%.

The average interest rate on loans to non-financial corporations fell to 6.03%. The rate on loans with maturity of up to one year decreased to 6.78%. The rate on loans with maturity of over one year and up to five years declined to 6.94%. The rate on loans with maturity of over five years dropped to 5.42%.

Notes: