YEREVAN, June 16. /ARKA/. Consumer lending in Armenia is not booming, but mortgage lending has intensified, Chairman of the Central Bank Martin Galstyan told reporters on Tuesday.
Earlier that day the Executive Board of the Central Bank made a decision to raise the refinancing rate by 0.5 percentage points, setting it at 6.5%. The regulator had already raised the rate by as much on May 4, 2021.
According to Galstyan, the raise is expected to make the local banks raise interest rates on loans to some extent, ‘which, on the one hand, can naturally affect investments, but, according to our estimates, it is extremely important that this affects private consumption,” Galstyan said. He said some banks have immediately reacted by raising rates on deposits.
According to him, over time, the increase in rates will be more pronounced, in general, a certain increase in rates is expected during 2021.
At the same time, he noted that over the last 5 months the consumer lending dropped by 3.8% year-on-year, while mortgage lending increased by 13.1%.
“Basically, the growth in mortgages is being prompted by the purchase of housing from the primary market, as the government returns income tax to pay off interest on mortgage loans,” Galstyan said.
He also noted that over the last 5 months, deposits in Armenian drams have grown by 4.2%, and in foreign currency by 5.1%. –0–
