Mortgage Rates Hit 2-Year, 4-Month High

In March, the interest rate on home-backed loans at deposit banks rose to 4.34% annually, marking a six-month consecutive increase and reaching the highest level in two years and four months. This was influenced by a significant rise in the 5-year corporate bond rate, a long-term interest rate indicator. A general increase in household loan rates was also observed. The rate for general personal loans increased by 0.04 percentage points to 5.57%, reversing a downward trend and rising for the first time in three months since January. Consequently, the overall rate for household loans was recorded at 4.51%, up 0.06 percentage points from the previous month.

Corporate loan rates moved in the opposite direction. Rates for large corporations fell by 0.02 percentage points to 4.11%, and rates for small and medium-sized enterprises decreased by 0.11 percentage points to 4.17%. The overall bank loan rate, including both household and corporate loans, declined by 0.06 percentage points to 4.20%.

The proportion of fixed-rate mortgages among all home-backed loans dropped sharply by 10.3 percentage points in one month, from 71.1% to 60.8%. The share of fixed-rate loans in total household lending also decreased from 43.1% to 35.5%, hitting its lowest point since September 2022, when it stood at 33.6%.

The interest rate on savings deposits (based on newly issued products) fell by 0.01 percentage points from the previous month to 2.82% annually, returning to a downward trend after one month. Rates for pure savings deposits like time deposits (2.79%) and market-type financial products such as financial debentures and certificates of deposit (CDs) (2.98%) also decreased by 0.01 percentage points each.

As lending rates fell more sharply than deposit rates, the spread between lending and deposit rates for newly issued products narrowed by 0.05 percentage points to 1.38 percentage points. However, the spread for outstanding balances widened by 0.01 percentage points to 2.27 percentage points.