Households’ overnight deposits have increased to EUR 60 bn

In July 2016, households' overnight deposits, i.e. the stock of deposits in traditional transaction accounts, rose to a record level, above EUR 60 bn. The amounts of these deposits have steadily increased over the last three years, by a total of EUR 10.7 bn, although the interest rate paid on transaction accounts is the lowest of the deposit rates (0.13%). In the same period the stock of deposits with agreed maturity has in turn declined by EUR 7.7 bn, to EUR 9.8 bn at the end of July. Households have clearly not wished to bind their assets at a low interest rate in deposits with agreed maturity, but prefer to keep them in accounts from which they are easily transferable to other use.

Overall, Finnish households' total assets in different deposit accounts exceed EUR 85 bn. This is more than ever before and equivalent to nearly 90% of households' stock of housing loans. In one year the stock of deposits has increased by EUR 3.4 bn.

As the stock of deposits has increased, the interest income has, however, decreased throughout the sector. In July, the average interest rate on deposits was 0.22%, against an 0.1 percentage point higher rate one year earlier. The average interest rate on overnight deposits was in turn 0.13% and on deposits with agreed maturity 0.80% in July 2016, as compared to 0.20% and 1.07% one year earlier.

Loans

Households' new housing-loan drawdowns amounted to EUR 1.8 bn in June 2016, on which the average interest rate was 1.21%. At the end of June, the stock of euro-denominated housing loans totalled EUR 93.1 bn and the annual growth rate of the housing loan stock was 2.7%. At end-June, household credit comprised EUR 14.3 bn in consumer credit and EUR 16.2 bn in other loans.

New drawdowns of loans to non-financial corporations (excl. overdrafts and credit card credit) amounted to EUR 1.5 bn in July 2016. The average interest rate on the drawdowns rose from June to 2.00 %. At the end of July, the stock of euro-denominated loans to non-financial corporations was EUR 74.5 bn, of which loans to housing corporations accounted for EUR 24.6 bn.

Deposits

In July, households concluded EUR 0.7 bn of new agreements on deposits with agreed maturity, at an average interest rate of 0.46%.

Notes:
MFIs comprise all monetary financial institutions operating in Finland.
Loans and deposits comprise all euro-denominated loans and deposits vis-à-vis the euro area as a whole, with countries other than Finland accounting for a very small share of total volumes.