Brazil - Risk premium on lending (lending rate minus treasury bill rate, %)

The value for Risk premium on lending (lending rate minus treasury bill rate, %) in Brazil was 22.90 as of 2021. As the graph below shows, over the past 24 years this indicator reached a maximum value of 57.80 in 1998 and a minimum value of 18.40 in 2013.

Definition: 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.

Source: International Monetary Fund, International Financial Statistics database.

See also:

Year Value
1997 53.40
1998 57.80
1999 54.06
2000 38.32
2001 37.56
2002 43.44
2003 44.98
2004 37.79
2005 36.62
2006 36.43
2007 32.22
2008 33.57
2009 34.95
2010 29.06
2011 32.22
2012 28.57
2013 18.40
2014 20.47
2015 29.80
2016 38.64
2017 37.86
2018 31.77
2019 31.30
2020 26.28
2021 22.90

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.

Periodicity: Annual

Classification

Topic: Financial Sector Indicators

Sub-Topic: Interest rates