|Red: Germany; Green: Italy; Blue: Spain and Yellow: Ireland. The Irish rate ids 2.81% but this is a composite rate and the data provided to the ECB has no loan values.|
Data from the European Central Bank issued on Tuesday showed that interest
rates paid on loans issued to the SME sector fell in Italy and Spain in
In recent months the ECB had been looking at what it terms
mechanism' where despite historical low official rates, small business in the
struggling economies were still subject to punitive real rates mainly due to
banjaxed banking systems.
SMEs (small and medium size businesses) account for about 75% of total euro area employment.
Rates charged on business loans of €250,000 to €1m dropped by 6 basis points in
the single currency area in July from the previous month.
For loans of more than €1m, the average rate in Belgium was 1.87%,
compared with 6.34% in Cyprus.
The interest rate on loans in Spain of up to €1m for one to five years dipped in
July to 5.46%, from a peak of 6.5% one year ago and the lowest level since
January 2011 while in Italy the cost of a similar loan, typically used by SMEs,
dropped to 5.25%, off by a percentage point since July 2012, and the
lowest level since September 2011.
The German rate was 3.57%.
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