Commercial bank loan users in Bosnia and Herzegovina have finally started repaying smaller monthly installments after two years of constant growth. The reason is the EURIBOR, which skyrocketed in 2022 and 2023, but has been recording a slight decline since last year.
Sanja V. from Banja Luka borrowed 130,000 KM from a commercial bank to buy an apartment in 2019. The interest rate is tied to the EURIBOR rate, which was negative at the time, and interest rates were at a historic low. The installment of this Banja Luka resident was 890 KM at the beginning of the repayment.
However, as the EURIBOR rate began to rise, so did her loan installment, which reached a monthly amount of 1,130 KM, which is 240 KM more than at the beginning of the repayment.
– Since April last year, the interest rate has started to decrease. First it was reduced to 1,060 KM, and since March I have been repaying 1,022 KM. I hope that we will have a new reduction from October – Sanja tells Fena. V.
According to the latest data from the RS Banking Agency for the third quarter of this year, the average weighted interest rates on housing loans in banks headquartered in RS are 4.84 percent. At the end of 2021, they were 4.21 percent.
Banks headquartered in RS and organizational units of banks from the FBiH in RS have placed a total of around 1.26 billion KM in housing loans to citizens, which is an increase of three percent compared to the end of 2024.
