PRODUCT PROFILE

Latest Dublin Prices

Loans to households down again in Q2

Wednesday, September 12 15:09:06

Loans to households for personal credit as well as mortgages fell during the second quarter with mortgage lending down for the tenth month in a row, latest Central Bank figures out today show.

Total credit to Irish private households outstanding on the balance sheet of resident credit institutions was E97.9 billion at end-June 2012, following a quarterly decline of 0.7pc and an annual decline of 3.9pc.

Including loans for house purchase that have been securitised and continue to be serviced by resident credit institutions, the total amount of loans to private households outstanding at end-June 2012 was E146.6 billion.

The total deposits held in resident credit institutions by Irish private households was E86.9 billion at end-June 2012, following a quarterly decrease of 0.1pc and an annual decline of 0.2pc.

The annual rate of change in loans for house purchase was minus 2.2pc at end-June 2012, following a quarterly decline of 0.4pc, the Central Bank said.

This was the tenth consecutive quarterly decline, bringing the outstanding amount of loans for house purchase on-balance sheet to E80 billion.

The outstanding amount of securitised mortgages, which continue to be serviced by resident credit institutions, was E48.7 billion at end-June 2012.

Floating rate mortgages, which include standard variable rate, tracker rate and mortgages with a fixed rate up to one year, accounted for 89pc of the outstanding amount of loans for house purchase on-balance sheet at end-June 2012.

Tracker mortgages by themselves accounted for 49pc of outstanding loans for house purchase to Irish residents on the credit institutions' balance sheet. The share of standard variable rate mortgages increased again during Q2 2012 to 38pc, following a net increase of E1 billion during the quarter.

Fixed rate mortgages accounted for 11.3pc of the outstanding amount of loans for house purchase on-balance sheet at end-June 2012, following a net decline of E1.3 billion during the quarter. Mortgages with a rate fixation period over one year and up to three years accounted for approximately 50pc of fixed rate mortgages outstanding.

The outstanding amount of on-balance sheet loans for buy-to-let residential properties was E19.5 billion at end-June 2012, accounting for 24.4pc of loans for house purchase. There was a net increase of E170 million in these loans during Q2 2012 (0.9pc), reflecting a rise of E355 million in floating rate mortgages and a decline in fixed rate mortgages of E185 million.

Non-housing related lending, or 'other personal' lending, accounted for 18.3pc (E17.9 billion) of total on-balance sheet credit advanced to Irish private households by resident credit institutions at end-June 2012.

The deposits held in resident credit institutions by Irish private households stood at E86.9 billion at end-June 2012. This followed a decrease of E89 million (0.1pc) during Q2 2012.

The outstanding amount of personal deposits was 0.2pc lower on an annual basis at end-June 2012, compared with annual rates of decline of 3.3pc and 0.7pc at end-December 2011 and end-March 2012, respectively.

The net flow of personal deposits in the year ending June 2012 was minus E150 million.