Bank of Estonia: Businesses Reduce Borrowing, Residents More Active in Auto Leasing
In May, Estonian companies obtained long-term loans and leasing worth €414 million – €61 million less than a year ago, while residents took out auto leasing of €27 million – up 38%. Housing loans also increased.
According to the latest data from the Bank of Estonia, in May companies received long-term loans and leasing totaling €414 million, which is €61 million less than in the same month last year. The largest share – €248 million – went to real estate, construction, and trade sectors. The average interest rate on long-term corporate loans fell from 4.72% to 4.58%.
At the same time, banks report a rise in problem debt: the volume of corporate loans overdue by more than 60 days increased from €54 million to €69 million over the month.
In contrast, residents are increasing demand for auto leasing. In May, they signed auto leasing agreements worth €27 million – 38% (or €8 million) more than a year earlier. This growth occurred despite higher interest rates: the average rate for private auto leasing rose to 4.50%, up 0.54 percentage points year-on-year.
Household savings also continued to grow. By the end of May, deposits reached €14.4 billion, up €62 million month-on-month and €931 million (6.9%) year-on-year. About €7.4 billion of this is in time deposits, with an average yield of 1.98%, slightly down from last year.
Housing loans in May amounted to €240 million, up €6 million from April and up 10% (€22 million) year-on-year. The average interest rate on new mortgage loans with collateral rose to 4.02%, 0.07 percentage points higher than the previous month and 0.39 points higher than in May last year.
