Financial Market Statistics, December 2009:

Household loans increasing quickly

The annual growth rate for lending to households from Monetary Financial Institutions (MFI) reached 9.3 percent in December 2009. MFIs include banks and housing credit institutions. The growth rate was 9.0 percent in November and the trend of increased growth in lending has gone on since June when the growth rate was 7.8 percent.

Households' total loans from MFIs amounted to SEK 2 334 billion at the end of December. Lending for housing purposes accounted for SEK 1 556 billion while households' consumption loans accounted for SEK 154 billion. This means that during 2009 households have increased their housing loans by SEK 160 billion and their consumption loans by SEK 9 billion. The growth rate for households' loans for housing purposes is at 11.5 percent while those for consumption loans have increased by 6.2 percent since the corresponding period of last year. 

In contrast, MFIs lending to non-financial corporations continues to decline. The growth rate was minus 5.3 percent in December, which is the fourth consecutive month of negative growth. The growth rate was minus 3.5 percent in November. Lending to non-financial corporations amounted to SEK 1 674 billion at the end of December. MFI lending to non-financial corporations amounted to SEK 1 768 billion and the growth rate was at 10.9 percent in December 2008.

Growth rate on lending to households and non-financial corporations

Interest rate and growth rate, lending to households and non-financial corporations

Meanwhile households' deposits in MFIs continue to increase although at a slower rate than earlier. Households' deposits with MFIs exceeded SEK 1. 000 billion for the first time in December. Households' deposits amounted to SEK 1 006 billion and the growth rate was 5.3 percent.

Percentage opting for fixed interest rates increases

Of the new loans to households taken in December from housing credit institutions, 61.5 percent of the amount loaned was at a floating interest rate while 38.5 percent of the amount loaned was at a fixed interest rate. This was a larger percentage with fixed interest rate than in the previous month when 34.8 percent chose fixed interest rates. By way of historical comparison, 35.4 percent of the amount borrowed was at a fixed interest rate in December 2008 while 53.1 percent had a fixed rate in December 2007. Loans with fixed periods of more than three months are considered as fixed interest rate loans.

Household lending rates were largely unchanged compared to November. The average interest rate for new MFI loans to households was 1.89 percent, which was also the case in November. However 2009 was a year of sharply decreasing interest rates, especially for loans with shorter interest periods. In December of 2008 the average interest rate for new loans to households was 4.08 percent.

MFIs' lending rates for new loans to non-financial corporations were 1.72 percent on average in December. Compared to November when the interest rate was 1.59 percent, this was an increase. In December 2008 the interest rate on new loans to non-financial corporations was 3.44 percent.

M1's growth rate declines

The growth rate for the narrow monetary aggregate, M1, decreased in December.  M1 had a growth rate of 7.9 percent, as compared to 9.5 percent in November. The growth rate was 6.4 percent in December of 2008. In total, M1 amounted to SEK 1 628 billion.

The growth rate for the broad monetary aggregate, M3, again had a downturn and was at minus 2.7 percent in December. The growth rate was 0.6 percent in November. M3 amounted to SEK 2 189 billion in December.

Money supply, annual growth rate

M1 consists of the public's holding of bank notes and coins as well as demand deposits by the public in MFIs and with the central government.  In addition to M1, M3 also includes deposits with certain conditions, repurchases, shares in money market funds, and short term securities.