Last year, interest rates on new saving deposits and loans, have registered their lowest levels. Such fact has been confirmed by experts of the Bank of Albania in the latest report on monetary policy. According to them, deposits and loans are registering very low levels and in their opinion, this has been caused by the facilitating policy applied by the Bank of Albania, in other words, this has been caused by the frequent reductions that the bank has made to the base interest rate for the national currency, lek, weakening this currency and reducing interest rates on deposits and loans. “Average interest rate on new deposits in lek was 0.9% on the third quarter of 2017, remaining near its average levels of the past two years”, experts of the Bank of Albania say, adding that the ones that have registered a growth are only saving deposits with a maturity period of 1 year. This shows that banks are favoring long term savings by Albanians. This is also indicated by the low interest rate on savings deposits with a short maturity period. Meanwhile the average interest rate for new saving deposits in euro has been 0.2%, which is below the average level of the past two years. “The difference between the interest rate for deposits in the domestic currency, lek and deposits in euro remains at its minimum level of 0.7%”, experts of the Bank of Albania say. On the other hand, interest rates for loans are several times higher than interest rates for deposits. “Average interest rate for new loans in lek in the third quarter of the year was 6.8%, slightly lower than the average of the two previous quarters”, experts further say. “This falling tendency has been noticed in loans for investments and in loans for cashflow”, they explain, adding on the other hand that interest rates for individual loans went down during the fourth quarter to 7.0% as opposed to 7.3% in the third quarter. This drop was seen in consumer loans and mortgage loans alike. “The difference between the average interest rates on loans in lek and loans in euro fell to 2.4%”, experts also say. According to them, the decline in loan costs (interest charges and commissions) has not been in line with the facilitation of other loan criteria.
Only interest rates on loans in euro register an increase
While all types of interest rates for deposits and loans are falling, it looks like the only ones on the rise are interest rates for loans in the European currency, euro. This is confirmed by the Bank of Albania’s monetary policy report, according to which, interest rate on this type of loan has registered an increase. “Average interest rate for new loans in euro registered a value of 4.3% in the fourth quarter of the year, with a slight increase on the third quarter of the year”, experts of the Bank of Albania say, adding that the biggest increase was registered by interest rates on loans used for cashflow and investments by businesses. Meanwhile, interest rates on consumer loans and individual mortgage loans remain unchanged.
Tax authorities: Introduction of VAT, businesses are unregistering
General Directorate of Taxation has identified a growing number of applications that businesses make to unregister or suspend their activity. This institution also says that this phenomenon has mainly been identified among businesses which have been penalized for different tax violations, but also by businesses which enter the Value Added Tax scheme for the first time. As far as this situation is concerned, tax administration appeals that if the investigations show that the tax payer who continues his activity in the same premises, has family relations with the tax payer who has applied for the activity to be shut down, he will face administrative measures.
Around 50% more businesses were shut down this year
This year registered a growing number of companies which are applying to shut down their activity at the National Business Center. So, according to the data provided by this institution, the number of businesses which have unregistered during the month of January 2018 was 732, marking a 50% growth on the number of businesses unregistered a year ago. So, while the number of businesses which unregistered during January last year was 387, this year,this figure was almost double. Data also show that the largest number of unregistered businesses is in the district of Tirana with 336 businesses, followed by Elbasan with 80 businesses, Korça with 70 businesses, Fier with 48 businesses, Durres with 45 businesses, Vlora 42, Berati 27, Shkodra 26, Lezha 21, Gjirokastra 15, Dibra 14 businesses and Kukës 8.