Net lending to Irish households rises again in October

Pandemic effect on savings continues with deposits scaling new heights

Central Bank statistics show net household deposits have increased 10.6 per cent year on year. Photograph: Alan Betson

Central Bank statistics show net household deposits have increased 10.6 per cent year on year. Photograph: Alan Betson

 

Net lending to Irish households increased by €210 million in October and rose 0.7 per cent year on year, according to new figures from the Central Bank. This continues the positive growth recorded in recent months, it said.

Loans for house purchase increased by €142 million in net terms in October, representing a fifth consecutive month of positive lending flows in the category. The annual growth rate is 1.1 per cent.

Consumer lending saw a net rise of €74 million. On an annual basis, repayments exceeded new lending by €79 million as people continued to pay down debt. This continues a trend that dates back to April 2020.

The pandemic effect on savings also remained in evidence, with deposits from households continuing to reach new heights and exceeding €136 billion at the end of October.

Increases

Over the month of October, household deposits recorded a net flow of more than €1.2 billion, while in annual terms, net household deposits increased by almost €13 billion or 10.6 per cent.

Overnight deposits, which includes money held in current accounts, continued to be the driver of both the monthly and annual increases in household deposits.

Deposits from non-financial corporations (NFCs) remained positive last month, increasing in net terms by almost €1.6 billion over the month. On an annual basis, bank deposits of Irish businesses increased by over €8.2 billion, representing an annual growth rate of 11.7 per cent.

Net lending to NFCs was negative in October 2021, decreasing by €374 million over the month. On an annual basis, NFC loan repayments exceeded drawdowns by €201 million, resulting in annual rate of change in total NFC lending of minus 0.6 per cent.