Figures from the Central Bank today show that Irish lenders have increased the cost of credit to borrowers following the recent collapse in the US subprime mortgage market.
A statement issued today by the Central Bank shows an increase of 30 points to 6.85 per cent on the one-year consumer loan rate in the month of August, while the yearly rate has seen a jump of 51 basis points from 8.39 per cent in July to 8.9 per cent in August.
One-year loans for companies on amounts of up to €1 million increased by 26 basis points to 6.5 per cent in August, while companies with one-year loans of over €1 million saw a rate increase of 37 basis points to 6.31 per cent.
Central Bank Governor John Hurley said: "The results show a net tightening of lending standards which is greatest with respect to loans to enterprises, particularly for the financing of mergers and acquisitions and corporate restructuring.
"Such a tightening at this point is not surprising."
