Do Banks in BiH expect Interest Rates to rise this Year?

The President of the Association of Banks of Bosnia and Herzegovina (BiH), Berislav Kutle, stated for agency Fena that in 2022 it is not realistic to expect an increase in interest rates on loans to individuals and legal entities.

It is clear that according to the growth of inflation, and especially the expectation of even greater growth this year, that would be theoretically expected. I say theoretically because according to economic criteria, that would be normal – expected. The situation with interest rates in the European Union (EU) is such that, regardless of inflation, the European Central Bank will not change interest rates until the middle of next year, and even if it raises them after that, it would be gradually, ” Kutle pointed out.

Further, he emphasized that it is not realistic to expect a significant reduction in interest rates, nor would it lead to any positive shift.

The illusion is that the level of interest is a problem in BiH and someone who cannot develop with such interest has a problem with the quality of products, and not with the price of capital, ” Kutle added.

Finally, he underlined that unfortunately for all of us and the future of this country, the demand for loans is at a level that does not promise rapid growth and development.


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