Money and Banking Statistics: April 2020

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Deposits from Irish resident households increased by €3.0 billion in April, the largest increase in household deposits since the series began. The growth in deposits is likely to reflect the reduced consumption due to the Covid-19 containment measures. Deposits from Irish non-financial corporations also increased, by €1.2 billion. This level of inflows is not unusual in recent years but may highlight an increased focus on cash management given the current economic environment.

Developments in Household credit and deposits

  • Bank lending to households recorded an annual growth rate of 1.2 per cent to end April 2020. This compares to an average annual growth rate of 2.0 per cent in the previous 12 months, between March 2019 and March 2020.
  • Loans for house purchase on banks’ balance sheets, decreased in net terms by €73 million over the month (Chart 1).
  • Consumer lending seems to have been significantly impacted by the COVID crisis, experiencing a net decrease by €277 million in the month. This is the largest monthly decline since early 2014.
  • Principal Repayments on lending for consumption and house purchase decreased by around a quarter over the month of April.
  • In April, the growth in deposits from households exceeded the already strong growth recorded in previous months. The net inflow of €3.0 billion over the month represents the largest ever since the series began in 2003. In annual terms, lodgements of household deposits were €9.7 billion higher than withdrawals, representing a growth rate of 9.1 per cent over the year (front page).
  • Overnight deposits, which includes current accounts, continued to be the main driver of the increase in household deposits as savers continue to utilise shorter-term deposit accounts (Chart 2). Overnight deposits comprise 84 per cent of all household deposits, a series high.

Developments in NFC credit and deposits

  • Net lending to non-financial corporations (NFCs) was €1.5 billion in April. Loans of up to one year maturity, which include revolving loans and overdrafts, increased by €512 million. The annual growth rate in NFC lending was 3.5 per cent, mainly driven by an increase in loans with a maturity of between one and five years (Chart 3).
  • NFC deposits continued to record increases, growing by €1.2 billion in April in net terms. Annual NFC deposit growth has been constantly positive in recent years, and grew by 14.6 per cent in the 12 months to April (Chart 4).

Developments in other counterparty sectors

  • The annual growth rate in total bank lending declined in the year to the end of April by 1.1 per cent (Chart 5), driven by a decline in lending to other banks. Lending to the private sector, which accounts for 79 per cent of banks’ loan books, increased slightly by 0.4 per cent in the twelve months to April 2020. The increase in total bank lending for April alone was €1.2 billion.
  • Bank deposits from Irish resident other financial institutions (including insurance corporations and pension funds) declined by €370 million during the month, while deposits from Irish resident monetary financial institutions grew by €740 million.
  • Credit institutions’ holdings of Irish-issued debt and equity securities decreased in net terms by €1.0 billion in April. On an annual basis this declined by 7.8 per cent, continuing a trend of declines observed since 2012.

Note 1:

Money and Banking statistics cover all credit institutions resident in Ireland. This includes licensed banks, building societies and, since January 2009, credit unions. A resident office means an office or branch of the reporting institution which is located in the Republic of Ireland. Data are reported in respect of resident office business only. Recent data are often provisional and may be subject to revision. For further detail, please see the Money and Banking webpage for:

Irish-headquartered banks refers to institutions whose ultimate parent entity is resident in Ireland.