Banks, Financial Services, Latvia, Loan, Real Estate
International Internet Magazine. Baltic States news & analytics
Friday, 29.03.2024, 08:48
High loan interest rates in Latvia are due to banks wanting to earn higher profits
"We should not pride ourselves on Latvian banks' best quarterly profits in the euro area, we should rather be proud if we had the lowest interest rates. We have to look for solutions to make the banks lower the rates," Eglitis emphasized.
The high interest rates have an impact on the investment level, economic activity in the country, lending volumes, and the overall competitiveness of Latvia, said Eglitis. "The largest banks' balance sheets are close to ideal, but lending is slow. This is not normal," said Eglitis.
He also said that the banking sector's reasons for the high interest rates were incorrect and not in line with the actual situation. Blaming the high interest rates on the EUR 1.3 billion losses the banks suffered in 2008 is unjustified, as the losses were largely due to the banks' inaction, said Eglitis. "The Financial and Capital Market Commission should also be more demanding in communication with the large banks' shareholders," said Eglitis, adding that the insolvency sector had also been put in order. In the meantime, interest rates remain too high, even for the large and "good" companies, and the only reason for that is that the banks want to earn more, he stressed.
The subcommittee will once again review banks' interest rates in six months, said Eglitis.
In turn, the Finance Latvia Association's board chairwoman Sanita Bajare told the subcommittee that loan interest rates were determined not by banks' wish to earn more, but by risk assessments based on actual data.
"The banks would like to increase lending volumes, but companies' ability to borrow, taking into consideration their capital adequacy and profitability, is weak. On the other hand, the banks' risk models have been approved by the watchdogs," said Bajare.
- 28.01.2022 BONO aims at a billion!
- 25.01.2021 Как банкиры 90-х делили «золотую милю» в Юрмале
- 30.12.2020 Накануне 25-летия Балтийский курс/The Baltic Course уходит с рынка деловых СМИ
- 30.12.2020 On the verge of its 25th anniversary, The Baltic Course leaves business media market
- 30.12.2020 Business Education Plus предлагает анонсы бизнес-обучений в январе-феврале 2021 года
- 30.12.2020 Hotels showing strong interest in providing self-isolation service
- 29.12.2020 В Латвии вводят комендантский час, ЧС продлена до 7 февраля
- 29.12.2020 В Rietumu и в этот раз создали особые праздничные открытки и календари 2021
- 29.12.2020 Latvia to impose curfew, state of emergency to be extended until February 7
- 29.12.2020 18-19 января Наталия Сафонова проводит семинар "Управленческий учет во власти собственника"