• Hüppa sisu juurde
  • Hüppa päise menüü juurde
  • Hüppa jaluse menüü juurde
LigipääsetavusEesti keeles
Eesti keeles
  • Annual Report
  • Estonian Economy and Monetary Policy
  • Financial Stability Review
  • Labour Market Review
  • Financing of the Economy
  • Estonian Competitiveness Report
  • Working Papers
  • Occasional Papers
  • Varia
  • Archive
researchMerike KukkNatalia Levenkointerest ratesloans

7/2022 Merike Kukk, Natalia Levenko. Interest rate spreads in Estonia: Different stories for different types of loan

Working Papers of Eesti Pank 7/2022

The paper studies the determinants of the interest rate spreads in Estonia, a country that stands out among European countries for its wide spreads. Four distinct credit markets are considered for housing loans, consumer loans, long-term corporate loans and short-term corporate loans. The paper uses quarterly panel data from 2000Q1–2021Q1. It uses a two-stage approach to disaggregate the observed spread into a component determined by the bank-specific factors and a component determined by the market-specific factors, which is labelled in the literature as the pure spread. For each of the two components, the paper finds substantial differences in the determinants of the spreads across different types of loan. While credit risk is important for long-term corporate and housing loans, operating costs are significant in the segment of short-term loans. Similarities found between the loan markets were that the pure spreads are found to be related to the business cycle and market concentration, while the relationship with interest rate risk is found to be insignificant.

JEL Codes: G21, G28, D40, E43

Keywords: interest rate spreads, interest rate margins, banking sector, housing loans, consumer loans, corporate loans, market concentration

DOI: 10.23656/25045520/072022/0197

Authors’ emails: [email protected], [email protected]

The views expressed are those of the authors and do not necessarily represent the official views of Eesti Pank or the Eurosystem.

Failid

  • PDF failitüüpi kujutav ikoon7/2022 Merike Kukk, Natalia Levenko. Interest rate spreads in Estonia: Different stories for different types of loan
Publikatsiooni 7/2022 Merike Kukk, Natalia Levenko. Interest rate spreads in Estonia: Different stories for different types of loan kaanepilt

Contacts

  • +372 668 0719
  • [email protected]
  • Contacts
  • Processing of personal data

Info

  • Frequently asked questions

Social Media

  • Facebook
  • Twitter
  • YouTube
  • SlideShare
  • Flickr
  • LinkedIn

References

  • European Central Bank
  • Eesti Pank Museum
  • Finantsinspektsioon
  • Other central banks

E-sources

  • E-shop