Lending for house purchase was 1.6 per cent lower on an annual basis in September and down 1.2 per cent on the previous month, according to figures from the Central Bank.
The bank’s monthly money and banking statistics also show that lending for consumption and other purposes has declined by 14.8 per cent and was marginally down on August figures. The figures are indicative of a trend amongst consumers to cut back on spending as well as more stringent credit criteria.
The net flow of household lending during the month of September was minus €279 million, in keeping with the trend which has seen a drop in loans to households every month so far in 2010.
Loans to households in the three months ending September 2010 consisted of an average net flow of minus €144 million in loans for house purchase, minus €270 million in consumer loans and minus €6 million in lending for other purposes.
Lending to business declined by 3 per cent in the year ending September 2010 and there was a €463 million or 1.5 per cent decline in loans of up to one year maturity, which includes the use of short-term facilities such as overdrafts.
Shorter maturity loans to business however increased significantly on a month-to-month basis in May, June and July 2010. Loans to business of up to one year maturity were 2.3 per cent higher on an annual basis in September 2010.
The Central Bank figures indicate that there was a small increase in business loans of a maturity of over one year and up to five years in both August and September. Combined with recent monthly declines in shorter-term facilities, this may suggest that businesses are their restructuring loans, whereby overdraft or revolving facilities are being refinanced over a longer term.
Deposits from the Irish resident private sector were 3.6 per cent lower on a year-to-year basis in September 2010 with the most significant decline in Irish private-sector deposits being in those with a maturity of up to two years.
