Financial Market Statistics, August 2008:

Lower growth for lending to households

The annual growth for lending to households in the Monetary Financial Institutes (MFIs) dropped to 10.2 percent in August, compared to 10.5 percent in July. This is the lowest growth rate since March of 2004. In August 2007 the annual growth rate for household loans was 11.7 percent.

Households' total debts to MFIs amounted to SEK 2 081 billion at the end of August. Of this amount, SEK 1 350 billion was loans for housing and SEK 142 billion was for consumption. Since August 2007 total lending to households has increased by SEK 192 billion.

The annual growth rate of MFIs' lending to non-financial enterprises also dropped. The growth rate in August was 11.3 percent, compared to 12.4 percent in July.

Growth rate and interest rate on lending to households

Small changes in interest rates

The MFIs' lending rates for new household loans decreased somewhat in August after having risen earlier in the year. The average interest rate for new loans to households was 5.95 percent in August, compared to 5.99 percent in July. At the same time last year the interest rate was 4.80 percent.

The decrease has occurred primarily for loans with a period of fixation of between three months and one year. The interest rate for these loans averaged 5.72 percent in August, compared to 5.97 percent in July. However, interest for household loans with a period of fixation of over five years has increased by 0.10 percentage points, from 5.93 percent in July to 6.03 percent in August.

Interest for MFIs' new loans to non-financial enterprises averaged 5.40 percent in August, or 0.03 percentage points lower than in July when interest was 5.43 percent. In August 2007 the average lending rate for new loans to non-financial enterprises was 4.45 percent.

Interest on deposits also fell in August. The average interest on new savings of households in bank accounts fell from 2.84 percent in July to 2.79 percent in August 2008. The corresponding rate in August 2007 was 1.93 percent.

In August, 64.5 percent of households' new loans from housing credit institutions had floating rates or a period of fixation of up to three months and thus 35.5 percent of loans were with fixed rates. Not since June of 2002 has there been such predominance for loans with floating rates.

Money supply growth rate decreases

Following the temporary increase in the annual growth rate of the money supply in July, the growth rate again fell in August. The narrow monetary aggregate M1 had an annual growth rate of 2.7 percent in August. The corresponding figure in July was 4.5 percent. The annual growth rate for M1 was 10.7 percent in August 2007. At the end of August 2008 M1 amounted to SEK 1 391 billion.

The broad monetary aggregate M3 had an annual growth of 12.9 percent in August 2008. This is lower than in July when the growth rate was 16.7 percent. M3 amounted to SEK 2 176 billion, an increase of SEK 22 billion compared to July.

Money supply, annual growth rate

M1 consists of the public's holding of banknotes and coins as well as demand deposits by the public in MFIs and with the central government. M3 also includes, aside from M1, deposits with certain conditions, repurchases, shares in money market funds, and short-term securities.

Definitions and explanations

Statisitcs Sweden compiles monthly financial market statistics on behalf of the Riksbank. These statistics are based on the MFI report. The MFI sector consists of banks, housing credit institutions, finance companies, institutions financed by municipalities and companies and monetary securities companies.

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Information on the quality of the statistics, production methods and tables and diagrams can be found on Statistics Sweden's website

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Producer Statistics Sweden, Balance of Payments and Financial Market Statistics Unit Box 24 300 104 51 Stockholm Fax +46 8 506 949 43	Enquiries Johannes Holmberg Tel. +46 8 506 945 11 E-mail johannes.holmberg@scb.se Jan-Olof Elldin Tel. +46 8 506 941 69 E-mail jan-olof.elldin@scb.se
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