ECB effect, rates on new mortgages close to 2% – Economy

Spread growth and a “hawk” from the European Central Bank has raised interest rates on new mortgages, which will approach 2% in May. Even if fixed rate mortgages are already above this limit. This is what emerges from the ABI’s monthly report, which takes into account both types. In detail, last month saw average rates increase to 1.93% versus 1.81% in April. However, in search engine simulations, fixed rate mortgages actually range from 2.3 to 2.8%, and even more than 3%. Variables are still just above 1%, but this is a “gap” that is set to close quickly due to Frankfurt and the Federal Reserve’s acceleration in monetary tightening which also affects reference market prices. For Italian families, the impact will in any case be limited compared to what has been seen in previous years. In fact, 85% of mortgages, assures ABI Deputy Director Gianfranco Torriero, are at a fixed interest rate. Obviously, those with a variable rate or those preparing to sign up for one will have to suffer the increases. The market is still lively. Also thanks to the rules in favor of young people under the age of 36, first home buyers are showing increasing trends.

Once again, the ABI, citing data from the Bank of Italy, indicates that of the total loans to households (+ 3.9%), the growth of mortgages is stable (+ 5.2%). For Italian banks, the monetary tightening of the European Central Bank has both positive and negative elements. Growth in government bond yields affects the stock portfolio but to a limited extent given that after the negative experience of the sovereign debt crisis, only a third are measured at fair value and therefore the impact on the balance sheet is limited. Thus, credit institutions will be less affected by debt tensions, moreover, they are in generally better conditions and a lower share of non-performing loans. According to ABI data, bad loans fell to 16.7 billion in April, moreover, the ratio with respect to total loans was 0.95% (it was 1.15% in April 2021). On June 28, a proposal for legislative intervention in the issue of bad loans will arrive by the Banking Investigation Commission. However, the wisdom of families and businesses remains. Deposits, although slowing slightly, posted a change of trend of +4.9% compared to +5.5% in the previous month and +6.2% in May 2021 “with an increase in absolute value year-on-year of 87 billion euros, bringing the amount. From Deposits to 1861.7 billion.”

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