Serbia Economic and FDI Outlook
Monetary Conditions Determine Financing Conditions
National Bank of Serbia
Interest rates on dinar government securities
are on a decline over the last few months
Chart 25 Interest rates in the primary market of government securities
(p.a. in %)
15
of the Private Sector
Interest rates on private sector loans declined
mildly in Q4 2023 and some declined further at the
start of this year
Chart 26 Interest rates on loans - new business
(p.a. in %)
13
11
9
7
5
3
24
20
16
12
8
4
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Dinar current assets loans to enterprises
0+
1
2013
2014 2015
2016 2017
2018 2019 2020
3 months
6 months
5 years
7 years
53 weeks
8 years
2021 2022
2 years*
10 years
2023
3 years
2024
12 years
Source: Ministry of Finance.
* Excluding coupon securities with the rate linked to the NBS key policy rate.
The share of long-term dinar securities (5+ year maturity)
increased from 2% in 2012 to almost 90% in 2024, with the
extension of the dinar yield curve to 12 years in February 2020.
Yield rates continued to decline as a result of lower government
financing needs, declining global yield rates, as well as lower
country's risk premium. The January and February auctions in
this year, for the sale of 8y dinar government securities, saw
record-high performances of a dinar securities auctions, with a
significant participation of non-residents.
Serbia's dinar-denominated bonds were included in renowned
J.P. Morgan GBI-EM family of indices as of 30 June 2021.
Dinar cash loans to households
Eur-indexed investment loans to enterprises
Eur-indexed housing loans to households
* From September 2010 to December 2014, "Other loans" of the household sector included cash loans and
other loans. From January 2015, "Cash loans" are shown separately.
·
In line with monetary tightening cycle that had a moderate
pace last year, interest rates on new dinar loans to the
corporates and households stabilized in recent months and
slightly declined starting from Q4 2023, up to
February 2024. In February interest rates:
some
- for current assets loans to corporates declined to 8.0%
- for cash loans to households equalled to 13.1%.
In accordance with the NBS decision to cap housing loan
rates, that will remain in force until end-2024, the average
rate on housing loans was kept at an unchanged level of
5.0% in February.
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