Template-Type: ReDIF-Paper 1.0

Author-Name: Ljupka Georgievska
Author-Name-First: Ljupka 
Author-Name-Last: Georgievska
Author-Email:  georgievskal@nbrm.mk
Author-Workplace-Name: National Bank of the Republic of Macedonia

Author-Name:  Rilind Kabashi
Author-Name-First: Rilind 
Author-Name-Last: Kabashi
Author-Email: kabashir@nbrm.mk
Author-Workplace-Name: National Bank of the Republic of Macedonia

Author-Name:  Nora Manova - Trajkovska
Author-Name-First: Nora 
Author-Name-Last: Manova-Trajkovska
Author-Email: manovan@nbrm.mk
Author-Workplace-Name: National Bank of the Republic of Macedonia

Author-Name:  Ana Mitreska
Author-Name-First: Ana 
Author-Name-Last: Mitreska
Author-Email: mitreskaa@nbrm.mk
Author-Workplace-Name: National Bank of the Republic of Macedonia

Author-Name:  Mihajlo Vaskov
Author-Name-First: Mihajlo 
Author-Name-Last: Vaskov
Author-Email: vaskovm@nbrm.mk
Author-Workplace-Name: National Bank of the Republic of Macedonia



Title:  Determinants of Lending Rates and Interest Rate Spreads in Macedonia

Abstract:  This paper focuses on investigating the determinants of lending rates and interest rate 
spreads in Macedonia. In order to quantify the effect of various factors on lending rates 
and interest rate spreads during the 2001-2009 period, we use panel estimation 
techniques on a sample of commercial banks in Macedonia. Our results indicate that 
lending rates are mostly influenced by bank size and market share, and to a somewhat 
lesser extent by deposit rates and non-performing loans. In addition, policy variables 
such as the domestic policy rate and the foreign interest rate also appear to be quite 
important. Furthermore, bank size and market share, as well as the differential between 
domestic and foreign rates, are the most important factors affecting interest rate 
spreads, while the effect of other factors is less clear-cut. 



Length:  28 pages

Creation-Date:  2010-08

File-URL: http://www.nbrm.mk/WBStorage/Files/WebBuilder_Determinants_LendingRates_InterestRateSpreads_Macedonia.pdf

File-Format: Application/pdf

File-Function: First version, 2010

Number: 2010-03

Classification-JEL: C23, E43, G21


Keywords: interest rates, banking system, panel estimation, Macedonia 



Handle: RePEc:mae:wpaper:2010-03