Interest rates on new loans gained 18 basis points last month to an average of 1.861 percent among the major state-run banks, lifted mainly by mortgage and working capital operations, the central bank said yesterday.
In particular, interest rates on new mortgages climbed to 2.101 percent, the highest since January 2009, it said, after compiling data from the Bank of Taiwan (臺灣銀行), the Land Bank of Taiwan (土地銀行), Taiwan Cooperative Bank (合作金庫銀行), Hua Nan Commercial Bank (華南銀行) and First Commercial Bank (第一銀行).
Together, the five lenders account for 40 percent of overall mortgage operations in Taiwan, and private banks tend to take cues from them when setting interest rates and risk premiums.
Photo: George Tsorng, Taipei Times
RISING MORTGAGES
Mortgages last month totaled NT$62.48 billion (US$2.02 billion), growing NT$15.67 billion from one month earlier, as property transactions spiked 33.7 percent from April, but shrank 6.45 percent from a year earlier.
The central bank attributed the month-on-month advance to five more working days last month, whereas the Tomb Sweeping Day holiday shrank the number to 17 in April.
Interest rates on new mortgages ahead are expected to fluctuate within a tight range, depending on the credit profiles of individual borrowers and the business strategy of banks, after the central bank on Thursday last week kept interest rates unchanged, the monetary policymaker said.
Interest rates for fresh working capital picked up 25 basis points to 1.802 percent, as some companies borrowed money to file corporate income taxes, the central bank said.
CAPITAL SPENDING
Interest rates on new capital expenditures rallied 37 basis points to 2.382 percent, even though the volume declined by NT$5.61 billion, the central bank said, adding that weak exports prompted local firms to cut back on capital spending.
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