• The interest of the financed ‘stock’ goes back to 2.13%, a threshold that I have not seen since 2013

The yield on the mortgage portfolio has more than doubled in the last year to levels unknown since 2013. According to Bank of Spain statistics, the interest rate on total financing granted to customers for the acquisition of real estate rose in the year from 1.50% to 3.12% in its TEDR referencewhich is the one that best reflects the transfer to business of monetary policy decisions as it does not include commissions associated with operations as the APR does.

The widening of the margin or interest in the entire portfolio goes hand in hand with the new concessions at higher prices and, above all, with the repricing of the stock financed at a variable rate, a process that takes one full year to complete from the date the Euribor hits ceiling. In the current situation, experts expect the indicator to peak within the current financial year and fold part of its rise throughout 2024, although the market discounts that it will continue to be installed at 2.5%-3% for several years. A situation that, according to financial sources, suggests that the interest rate on the total financed stock will take time to reach the maximum for this cycle within a year, and by then may exceed 3.5%-4%, which is not see since the financial crisis.

Financial crisis

Despite the increase, the interest is far from the Euribor which in its daily rate climbed yesterday to 3.576% and raises the average for the month of February to 3.467% in the twelve days that it has traded against the floor of -0.502% with which it closed 2021 before the European Central Bank (ECB) began to raise rates. The agency placed the price of money in the eurozone at 3% at the February meeting and the market discounts one or two additional increases of 50 basis points.

His trajectory is followed by products and portfolio repricing, even in advance. The APR on newly granted mortgages rebounded last year from 1.50% to 3.12% and, according to the Bank of Spain, entities are delaying the impact on financing of the rate escalation due to competition to lend. Unlike other similar moments, where rate hikes have taken place, entities have ample liquidity piggy banks and, therefore, do not have the pressure to capture savings from customers with high deposits, which make funding resources more expensive to lend .

No pressure in tanks

The bank granted 65,227 million euros in new mortgages last year, a figure that is 9.76% higher than that arranged the previous year and represents the best record since the 69,478 million lent in 2010. However, the stock financed or the portfolio of business decreased by 0.07% and stood at 510,944 million because debt repayments by clients exceeded the amount of the new concession. Thus, the progress made in 2021 was broken after a decade of business contraction.

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