Household deposits reached record high in September

Household deposits hit a new record high of €135 billion at the end of September, according to the latest figures from the Central Bank.

The latest set of money and banking statistics show household deposits over the month recorded a net flow of just over €1 billion, contrasting with last month’s withdrawals exceeding lodgements by €56 million.

In annual terms, net household deposits increased by €13.5 billion, or 11.1 per cent. Overnight deposits, which include current accounts, continued to be the driver of the monthly and annual increases in household deposits.

Net lending to households increased by €328 million in September. In annual terms, net lending increased by €505 million, or 0.6 per cent, in the year to September continuing the positive growth recorded since July.

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This contrasted with the 12 months to September 2020, where net annual lending fell by €32 million.

Loans for house purchase increased by €306 million in net terms in the month, although end of quarter figures are always higher due to seasonal effects.

The annual growth rate in the year to the end of September remained positive, with loans increasing by €760 million or 1.1 per cent.

Consumer lending saw a net increase of €38 million, a slightly smaller increase from the previous month of August.

On an annual basis, repayments exceeded new lending by €123 million or 1.1 per cent. This continued a trend of negative 12-month rolling sums for consumer lending.

Net lending to non-financial corporations (NFCs) turned positive, increasing by €293 million during the month.

On an annual basis, NFC loan repayments exceeded drawdowns by €190 million. The annual rate of change in total NFC lending was -0.5 per cent. This compared with a growth rate of -5.1 per cent in September 2020.

Deposits from NFCs remained positive in September, increasing in net terms by €431 million.

On an annual basis, NFC deposits increased by €7.5 billion, representing an annual growth rate of 10.9 per cent. This compares with an annual growth rate of 19.1 per cent recorded in September 2020.

Total bank lending to Irish resident sectors declined by 0.5 per cent in the year to the end of September driven by a decline in lending to the private sector, which experienced a fall of 0.7 per cent.

Banks’ holdings of deposits from the Irish resident private sector continued to record strong inflows, with annual growth at 11.4 per cent as at the end of September. Irish resident households remained the largest contributing sector to deposits on banks’ aggregate balance sheet.

Irish-resident banks’ outstanding borrowing from the Central Bank as part of Eurosystem monetary policy operations increased slightly and now stands at just over €24.5 billion.