According to the central bank’s lending survey, the interest rate on new Lek-denominated loans rose to 6.8% in the second quarter from 6.6% in the first quarter and from 6.7% during the same period of the previous year.

Interest rates on three loan categories have increased during the reviewed period, with the average interest rate reaching 6.7% in the second quarter, from 6.5% and 6.1% in the two previous quarters, the Bank of Albania said.

The category of small business loans amounting up to 35 million Lek has recorded minimal, but continuous growth since the last quarter of the previous year. Interest rate on this loan category was 7.7% in this quarter.  The cost of financing for short-term liquidity has resulted in an increase with the interest rate on overdraft and working capital standing at 6.4% in the second quarter from 6% in the first quarter and 6.3% last year.

On the other hand, the interest rate on the Euro-denominated loans was 7% in the second quarter, remaining unchanged compared to the first quarter of 2024, and up from 6.6% compared to the second half of 2023.

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According to BoA, in the first six months of 2021, the new business loan amounted to ALL 68.5 billion.

The growth of business credit was supported by investment loans, led by the sectors: energy, construction, wholesale and retail trade, tourism and other service activities.

The total energy stock credit, at the end of June of 2021, accounted for over 30% of lending, ranking it the sector with the highest share of credit.

In the first quarter of 2021, investments in energy led the foreign direct investment in Albania, bringing the largest share of investments to 28%  of the total. //a.i/