Banks lent €935 million for home purchases in December, which was the highest amount since September 2008, new data from the Central Bank shows.
Net lending to households was €876 million in the month, which was higher than in the previous month and in line with similar patterns on the same month in past years.
The regulator said the movement was “entirely driven” by loans for house purchase, with a €935 million flow in the month, the highest since September 2008, when monthly flows from that category stood at €986 million.
Loans for other purposes and loans for consumption had a negative contribution with outflows in the month worth €46 million and €13 million respectively.
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In annual terms, lending to households increased by €5.5 billion, or 5.2 per cent, in the year to the end of December. This falls to 5.1 per cent after accounting for the impact of repayments on securitised loans.
Similarly to monthly developments, loans for house purchase were the “main driver”, with €5 billion of net lending in the period. Loans for consumption contributed with €900 million, while loans for other purposes decreased by €365 million in the same period.
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The annual change in loans for house purchase, including both on-balance sheet and securitised loans, was 5.5 per cent in the year.
Household deposits with banks “remained muted” in December, the Central Bank said, increasing by just €78 million after recording a negative flow in November. Household deposits stock stood at €169.8 billion at the end of the month.
This was mostly driven by deposits redeemable at notice and deposits with an agreed maturity up to two years, which contributed €69 million and €61 million respectively. Overnight deposits, on the other hand, dropped by €48 million in the month.
On an annual basis, household deposits increased by €10.6 billion, or 6.7 per cent, in the year. They previously increased by €6.9 billion in 2024 and €4.4 billion in 2023.
Even though all maturities recorded positive flows last year, overnight deposits, and to a lower extent, deposits with an agreed maturity up to two years, stood as the main drivers, recording flows worth €6.4 billion and €3.5 billion respectively.
Annual growth for deposits with an agreed maturity up to two years turned positive in June 2023 and recorded a steady increase until September 2024. It has since then remained positive but slowing down steadily.
This follows the trend observed in previous months and is consistent with declining interest rates, the Central Bank said.
Annual flows of deposits redeemable at notice remained positive at €653 million in December, driven by a one-off significantly elevated monthly flow in July, but monthly flows have been muted since then.
Deposits with an agreed maturity over two years remained muted and have showed no activity since April 2024.
