Even though they remain high, as the head of the Economic Department of Brazil’s Central Bank (BC), Altamir Lopes admits, the interest rates charged for personal loans are the lowest since the Real Plan was first adopted in July, 1994.
The average annual interest rate charged for such loans in March was 59%. These data are contained in the monthly report on Monetary Policy and Financial System Credit Operations, issued by the BC on Tuesday, April 25.
Another index that remains high is the spread, the difference between what it costs banks to obtain money and what they charge to lend it. The bank spread for individuals was 44% in March.
The report demonstrates that bank spreads have been growing, despite the cuts made by the BC in the annualized overnight benchmark interest rate, used in the Special System of Liquidation and Custody (SELIC).
Albeit high and trending upwards, the current bank spread is still close to its historic floor. According to the report, the lowest bank spread in the past ten years was 42.6%, in April, 2005.
Interest rates on bank loans to corporate entities were also near their historic lows. The average annual rate charged in March, 30.7%, was the lowest since September, 1994.