Armenia | Risk premium on lending (lending rate minus treasury bill rate, %)

Risk premium on lending is the interest rate charged by banks on loans to private sector customers minus the "risk free" treasury bill interest rate at which short-term government securities are issued or traded in the market. In some countries this spread may be negative, indicating that the market considers its best corporate clients to be lower risk than the government. The terms and conditions attached to lending rates differ by country, however, limiting their comparability. Development relevance: Both banking and financial systems enhance growth, the main factor in poverty reduction. At low levels of economic development commercial banks tend to dominate the financial system, while at higher levels domestic stock markets tend to become more active and efficient. The size and mobility of international capital flows make it increasingly important to monitor the strength of financial systems. Robust financial systems can increase economic activity and welfare, but instability can disrupt financial activity and impose widespread costs on the economy. Limitations and exceptions: Countries use a variety of reporting formats, sample designs, interest compounding formulas, averaging methods, and data presentations for indices and other data series on interest rates. The IMF's Monetary and Financial Statistics Manual does not provide guidelines beyond the general recommendation that such data should reflect market prices and effective (rather than nominal) interest rates and should be representative of the financial assets and markets to be covered. For more information, please see http://www.imf.org/external/pubs/ft/mfs/manual/index.htm. Statistical concept and methodology: The risk premium on lending is the spread between the lending rate to the private sector and the "risk-free" government rate. Spreads are expressed as an annual average. A small spread indicates that the market considers its best corporate customers to be low risk; a negative value indicates that the market considers its best corporate clients to be lower risk than the government.
Publisher
The World Bank
Origin
Republic of Armenia
Records
63
Source
Armenia | Risk premium on lending (lending rate minus treasury bill rate, %)
1960
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2001 6.09607851
2002 6.38733452
2003 8.91725644
2004 13.36269123
2005 13.93380345
2006 11.65992382
2007 11.42687703
2008 9.36170272
2009 9.34486095
2010 8.61460174
2011 8.22797379
2012 7.43423074
2013 6.69774153
2014 8.60702498
2015 4.69454282
2016 7.52550445
2017 7.67789334
2018 6.57465026
2019 6.10504729
2020 5.79772969
2021 3.96306581
2022 1.13146396

Armenia | Risk premium on lending (lending rate minus treasury bill rate, %)

Risk premium on lending is the interest rate charged by banks on loans to private sector customers minus the "risk free" treasury bill interest rate at which short-term government securities are issued or traded in the market. In some countries this spread may be negative, indicating that the market considers its best corporate clients to be lower risk than the government. The terms and conditions attached to lending rates differ by country, however, limiting their comparability. Development relevance: Both banking and financial systems enhance growth, the main factor in poverty reduction. At low levels of economic development commercial banks tend to dominate the financial system, while at higher levels domestic stock markets tend to become more active and efficient. The size and mobility of international capital flows make it increasingly important to monitor the strength of financial systems. Robust financial systems can increase economic activity and welfare, but instability can disrupt financial activity and impose widespread costs on the economy. Limitations and exceptions: Countries use a variety of reporting formats, sample designs, interest compounding formulas, averaging methods, and data presentations for indices and other data series on interest rates. The IMF's Monetary and Financial Statistics Manual does not provide guidelines beyond the general recommendation that such data should reflect market prices and effective (rather than nominal) interest rates and should be representative of the financial assets and markets to be covered. For more information, please see http://www.imf.org/external/pubs/ft/mfs/manual/index.htm. Statistical concept and methodology: The risk premium on lending is the spread between the lending rate to the private sector and the "risk-free" government rate. Spreads are expressed as an annual average. A small spread indicates that the market considers its best corporate customers to be low risk; a negative value indicates that the market considers its best corporate clients to be lower risk than the government.
Publisher
The World Bank
Origin
Republic of Armenia
Records
63
Source