New figures released today by the Central Bank show that household investment in deposits was €1bn in the second quarter of 2017, its highest level since mid-2008. 
 
This represented an increase of €155m compared to the previous quarter. Most of the transactions in deposits over the quarter were with MFIs (€0.9bn). Meanwhile, household’s deposits transactions with Government declined for the second consecutive quarter.
 
Household net lending increased further during the second quarter 2017 reaching €2.9bn. This represented the second consecutive quarterly increase in net lending. The increase in net lending of €0.3bn over the quarter was due to increased investment in financial assets (+€0.2bn) and, to a lesser extent, continued debt reduction by household (-€0.1bn).
 
The figures show that private sector debt as a proportion of GDP fell by 17.2 percentage points over the quarter to stand at 265.3%. This was its lowest level since the beginning of the financial crisis. This fall in private sector debt was the result of reductions in the debt owed by both households (€0.9bn) and NFCs (€32.9bn), with an increase in annualised GDP also contributing. The latter increased by €5.3bn, or 1.9% over the period. 

On a year-on-year basis, private sector debt as a proportion of GDP has fallen by 51.6 percentage points. The Central Bank today noted that private sector debt in Ireland is significantly influenced by large multinational corporations (MNCs) and that restructuring by these entities has resulted in extremely large movements in Irish private sector debt, particularly from 2014 onwards.
 
Source: www.businessworld.ie