Significance and role of Eesti Pank Governance, reporting Banknotes and coins Publications Statistical indicators Legislation European Union Press Press releases ECB press releases Economic policy statements Photos and CVs Using Estonian kroon in advertising Events Eesti Pank Museum Estonian economy Euro exchange rates Estonian kroon fixings TALIBOR Percentage rate of consumer loans charge ECB rate of interest

Siret Vildo, Financial Sector Policy Division, Specialist

The corporate and household loan and leasing stock increased in November by 248 million kroons, i.e., 0.1%. The annual growth rate declined to 10%. The November decline concerned primarily the loan and leasing portfolio volume of the retail trade and of other household loans, including car leasing. The growth of mortgage loans issued to households, which has dropped to the lowest level in recent years, reflects the modest development of the real estate market. The volume of housing loans added during the first eleven months of 2008 accounts for 45% of the loan volume added during the same period last year.

Whereas the volume growth of loans overdue by more than 60 days was relatively modest for the past three months, the share of overdue loans increased by approximately 700 million kroons in November. In November the share of loans overdue by more than 60 days constituted 2.5% of the total loan portfolio of banks. In October, the indicator was 2.2%. Like in earlier months, the volume of overdue loans is the biggest in the real estate and construction sectors, and as regards households, in the segment of consumer credit - 4.5% and 5.6%, respectively. According to Eesti Pank's estimate, the share of overdue loans will continue to increase throughout the next year, rising to the level of 5% of the total loan portfolio.

The volume of the deposits of Estonian households and non-financial enterprises decreased by 885 million kroons, i.e., 0.8% in November. The annual growth rate declined to 4%. Whereas the annual growth of household deposits was positive in November, constituting 10.9%, the volume of corporate deposits was 1.6% smaller year-on-year.

Although the interest margins of new loans were raised in November, the average interest rates on housing loans and long-term corporate loans dropped to 5.9% and 6%, respectively, in November due to declining Euribor.

Figure 1. The annual growth of household and corporate loans and leases in Estonia

Figure 2. The volume of corporate and household deposits (EEK million) in Estonia and the annual deposit growth rate

Figure 3. The weighted average interest rate on housing loans and long-term corporate loans issued within a month and the 6-month EURIBOR

Starting in 2009, Eesti Pank will publish the consolidated balance sheet of credit institutions on the 17th banking day instead of the 11th. In addition to the consolidate balance sheet of credit institutions, more detailed banking statistics will also be published on the 17th banking day together with a respective comment by Eesti Pank. The December consolidated balance sheet of credit institutions and banking statistics will be published on the web site of Eesti Pank on 26 January 2009.