Household debt fell to €166bn during Q4 2013
Household debt sustainability improved significantly during the same quarter
Overall, debt has fallen by 18.3 per cent since its peak at the end of 2008.
Household debt fell by €2.4 billion to €166 billion or €36,203 per capita, during the fourth quarter of last year, the largest decrease since the final quarter of 2012, according to figures released yesterday by the Central Bank.
Household debt sustainability improved significantly during the same quarter, falling by 3.5 percentage points to 192 per cent.
The decline largely reflected the reduction in household debt, as well as, to a lesser extent, a slight increase in disposable income, according to the bank’s report.
The decline in household debt represented net repayments of debt (€0.6 billion), loan reclassifications and loan write-downs. Overall, debt has fallen by 18.3 per cent since its peak at the end of 2008.
Household debt sustainability was at its lowest level since the third quarter of 2006 but continues to remain high by international standards. Household debt to total assets fell by 0.8 percentage points to 24.4 per cent. The decline was driven by both the decrease in debt and an increase in the value of household assets.
Household net worth rose by a further 2.9 per cent and by the end of the quarter stood at €504.2 billion, equivalent to €109,771 per capita. Net worth has been on an upward trend since the third quarter of 2012.
The domestic economy continued to be a net lender, albeit to a slightly lesser extent than in the third quarter of last year.
Government net financial wealth increased by €1.8 billion to reach -€146.1 billion, representing the first increase since the fourth quarter of 2009.