Loan boom, credit is becoming a habit, Albanians invest more

Albanian citizens and entrepreneurs received 203 billion lek in loans in the first half of the year. Data from the Bank of Albania show that compared to January-June last year, loans have expanded by 21.3 billion lek or 11.7 percent.

"This increase shows greater trust of citizens and businesses in the banking system, but also an increased need for financing in a period of low inflation and more stable interest rates," Artur Ribaj, lecturer and banking system expert, told A2 CNN.

"The main reason, as expressed by the Bank of Albania, is related to mortgage loans for the purchase of real estate. This is the main sector where investment is being made. There is an almost 7-fold increase compared to previous periods," Selim Blliku, an expert on economic issues, told A2 CNN.

Data from the Central Bank shows that over 67 billion lek of loans were taken from banks for the purchase of housing in the 6-month period from January to June. This amount is 21.3 percent of the new loans granted in this period.

"All this comes after the banking sector is considering lending for new apartments safe. The fact that the banking system has sufficient liquidity today has also had an impact," Blliku added.

"It is an increase that also comes as a reflection of urbanization and internal migration. The increase in construction has generated high demand for housing loans, especially in large cities," Ribaj added.

At an even faster pace than citizens, to open new businesses or expand existing ones, entrepreneurs received over 131 billion lek in loans in 6 months.

The rest of the loans belong to public institutions. "The main reason, as the Bank of Albania has also stated, is related to mortgage loans for the purchase of real estate. This is the main sector where investments are being made. There is an almost 7-fold increase compared to previous periods," Blliku underlined.

"Business credit is being supported by clearer guarantees and more in-depth risk analysis. Banks are showing flexibility in the SME segment," Ribaj emphasized.

Data from the Central Bank shows that last month alone, Albanians received nearly 39 billion lek in loans, 7.7 billion or 24.7 percent more than a year ago. (A2 Televizion)