Assesment of the Interest Rates in the Serbian Banking Sector

Lidija Barjaktarović (), Maja Dimić () and Dejan Ječmenica ()
Additional contact information
Lidija Barjaktarović: University Singidunum, Belgrade, Serbia
Maja Dimić: University Union Nikola Tesla, Sremski Karlovci, Serbia
Dejan Ječmenica: Wiener Städtische, Vienna Insurance Group, Belgrade, Serbia

Journal of Central Banking Theory and Practice, 2014, vol. 3, issue 2, 21-35

Abstract: Lending interest rates (IR) in the Serbian market are generally viewed as high. In accordance with the official NBS (National bank of Serbia) data for 2010: lending (IR) was 10.4% p.a., deposit IR was 4.2% p.a., and spread was 6.3% p.a. At the same time, IR on cross-border loans was 3.7% p.a. It means that the use of cross-border loans was a better solution for companies which were in position to take them. The indicator of IR spread in Serbia got worse and came down to 106th position (it used to be ranked 90th in 2009; WEF). If we analyse the structure of IR spread, we can notice that there is room for decreasing the level of active IR in the area of country risk premium and funding spread. Pearson Correlation shows that IR has strong relation with return on assets and volume of collected deposits i.e. profit margin per product.

Keywords: banking sector; interest rates; base part; margin; credit rating; standard risk cost; country risk (search for similar items in EconPapers)
JEL-codes: E43 G21 (search for similar items in EconPapers)
Date: 2014
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.cbcg.me/repec/cbk/journl/vol3no2-2.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cbk:journl:v:3:y:2014:i:2:p:21-35

Access Statistics for this article

More articles in Journal of Central Banking Theory and Practice from Central bank of Montenegro Contact information at EDIRC.
Bibliographic data for series maintained by ().