Interest rates in banks and other financial enterprises, Q4 2012

The loan margins in banks and mortgage companies were 2.40 percentage points at the end of 4th quarter 2012, up from 2.29 percentage points at the end of 3rd quarter same year. The interest rate on loans between banks, NIBOR , was 1.87 per cent at-end 2012. This is a decrease of 1.09 percentage points compared to the end of 2011.

The banks’ interest margin was unchanged at 2.45 percentage points at the end of 4th quarter 2012. The interest rate margins have been stabile between 2.40 and 2.48 percentage points the last five quarters.

Decrease in interest rate on loans

The average interest rate on loans from banks and mortgage companies fell by 0.03 percentage points in 4th quarter 2012, to 4.27 per cent. The interest rate was 0.34 percentage points lower compared to the same period in 2011. Banks’ and mortgage companies’ interest rate to households fell marginally by 0.02 percentage points in 4th quarter 2012, while interest rate to private non-financial corporations fell by 0.04 percentage points in the same period. Banks and mortgage companies constituted for a share of respectively 53 and 39 of total public loans in NOK in 4th quarter 2012. Hence these two financial institutions covered above 90 per cent of the total loans.

The interest rate on loans from state lending institutions (excluding loans with zero interest rate) fell by 0.06 percentage points to 2.92 per cent in 4th quarter of 2012. Compared to the same period last year, this is a decline of 0.46 percentage points. The interest rate on loans from the Norwegian Public Service Pension Fund was nearly unchanged at 2.23 per cent at the end of 2012.

Lower interest rate on housing loans

The interest rate on total loans secured on dwellings from banks and mortgage companies fell by 0.03 percentage points to 3.98 per cent in the 4th quarter 2012. Loans secured on dwellings are divided into two types; repayment loans and credit lines. The interest rates on both types of loans fell in 4th quarter 2012, and compared to the same period in 2011, interest rate on loans secured by dwellings was 0.27 percentage points lower in 2012. As shown in the statistics Financal corporations, balance sheet about 90 per cent of total loans secured on dwellings are issued to employees.

Stable interest rate on bank deposits

The banks’ interest rate on deposit was approximately unchanged at 2.31 per cent from the end of 3rd quarter to the end of 4th quarter in 2012. The NIBOR rate is still low, and leads to a further 0.15 percentage points fall in the deposit margin in 4th quarter 2012, to -0.44 percentage points.

The interest rate on deposits from households rose by 0.03 percentage points to 2.40 per cent in 4th quarter of 2012, while the interest rate on deposits from private non-financial corporations fell by 0.05 percentage points to 2.09 per cent in the same period.