Downturn for households' growth in loans

Monetary Financial Institutions, MFIs, lending to households had an annual growth rate of 5.7 percent in September. The corresponding growth rate in August was 6.2 percent, which implied a continued downturn in the growth rate. The growth rate was 8.9 percent in September 2010. MFIs include banks, housing credit institutions and finance companies.

Households' borrowing from MFIs in September amounted to SEK 2 619 billion. Housing loans accounted for the largest part, or SEK 2 097 billion. Housing loans are loans to households with single-family dwellings, condominiums and tenant-owned apartments that serve as collateral. Mainly, loans that were neither housing loans nor consumption loans accounted for the downturn; instead, loans with other security than dwellings or unsecured loans contributed to the downturn. Of the outstanding housing loans, 52 percent were taken with a floating rate; in August, the corresponding rate was 53 percent. Households' loans for consumption amounted to SEK 162 billion and had an annual growth of 4.7 percent. In August the growth rate was 3.0 percent.

MFIs' lending to non-financial corporations amounted to SEK 1 813 billion in September. The annual growth rate was 6.2 percent, an increase compared to August when the growth rate was 5.1 percent. In September 2010 however, the growth rate was negative at -0.5 percent.

Growth rate, lending to households and non-financial corporations

Downturn in lending rates to households

The average interest rate on new loan agreements of households was 4.14 percent in September, a downturn against 4.26 in August. This is the second month in a row that the average rate showed a downturn. Both short and long term rates went down. The floating interest rates that had earlier shown an upward trend since April 2010 decreased somewhat in September, from 4.43 percent in August to 4.39 percent in September. The downturn can stem from the banks while the housing credit institutions still show weakly rising floating rates. The long term rates also showed downturns. The largest downturn was seen for rates with a fixed period over 1 year up to 5 years; these rates decreased 0.20 percentage points and amounted to 3.86 percent.

In September the average interest rate on households' new deposits for all types of bank accounts was 1.37 percent, an increase from 1.35 percent in August. Interest rates on accounts with fixed periods or a limited number of free withdrawals rose from 2.19 percent in August (revised figure) to 2.21 percent in September. However, interest on accounts with a fixed period of over two years decreased from 4.01 percent in August to 3.26 percent in September.

MFIs' lending rates for new loan agreements to non-financial corporations rose slightly in September. The average interest rate was 3.65 percent in August and rose to 3.66 percent in September. In September 2010 the interest rate was 2.37 percent.

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

	Interest rate, new agreements to housholds	Growth rate, lending to households	Interest rate, new agreements to non-financial corporations	Growth rate, lending to non-financial corporations
Sep 2010	2.84%	8.9%	2.37%	-0.5%
Aug 2011	4.26%	6.2%	3.65%	5.1%
Sep 2011	4.14%	5.7%	3.66%	6.2%

Positive M1 growth rate

The narrow monetary aggregate M1 had an annual growth rate of 0.2 percent in September. This is the first time since January of 2010 that the growth rate was positive. In August the growth rate was -0.1 percent. M1 amounted to SEK 1 555 billion in September.

The growth rate for the broad monetary aggregate M3 was 7.8 percent in September. This is higher than in August when the annual growth rate was 6.3 percent (revised figure). In total, the M3 amounted to SEK 2 367 billion in September.

Annual growth rate of the money supply

M1 consists of the general public's holdings of bank notes and coins as well as demand deposits by the general 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.

Definitions and explanations

Statistics Sweden compiles monthly financial market statistics on behalf of the Riksbank. These statistics are based mainly on the MFI report. The MFI sector consists of banks, housing credit institutions, finance companies, institutions financing municipalities and companies, monetary securities companies and monetary investment funds (money market funds).