Deposits from Irish households hit new heights during Level 5 lockdown

Central Bank statistics also show that in the week following the introduction of Level 5 restrictions, total card spending fell 13% compared to the same month last year

Deposits from Irish households and non-financial corporations (NFCs) are the highest on record, according to new Central Bank figures.

Deposits from Irish households and non-financial corporations (NFCs) are the highest on record, according to new Central Bank figures.

The outstanding amount of household and NFC deposits now stand at €123 billion and €70 billion, respectively, with household and NFC lodgements exceeding withdrawals by more than €2.6 billion in October.

Irish households drew down €114 million more than was repaid last month.

The drawdown of loans to Irish households in the twelve months up to the end of October exceeded repayments by €19 million. However this is a steep drop from the same month last year, where drawdowns exceeded repayments by €1.9 billion.

However, mortgage lending increased in net terms by €97 million last month, compared to a net increase of €102 million in October 2019.

In annual terms, the growth rate remained positive, at 0.9%, down from 1.7% a year earlier.

Annual growth in mortgage lending net flows was €679 million, the lowest since July 2018.

Consumer Lending recorded a net increase of €31 million last month. However, on an annual basis, repayments exceeded new lending by €533 million over the year to end-October 2020, representing an annual growth rate of -4.1%.

NFCs repaid €363 million more than was drawn down last month while on an annual basis, loans declined by €2.6 billion, with the majority of the annual decrease concentrated in the up-to-one-year maturity bracket.

The annual rate of change in total NFC lending declined further to -6.5% representing the most negative annual growth rate recorded in the category since November 2015.

Impact of Level 5

New Central Bank statistics also show that in the week following the introduction of Level 5 restrictions, total card spending (including ATM withdrawals) fell 13% compared to the same month last year.

However, while the Level 5 measures impacted on spending, the Bank said the extent of the impact was “much smaller” than in the initial restrictions introduced last March.

Similar to the initial lockdown, card spending increased in the days prior to Level 5 restrictions being introduced in late-October, with a subsequent decrease in card spending observed in the following days.

The Level 5 lockdown led to a fall in total card spending.

For the week up to November 23, ATM withdrawals were down 37% and card spending was down 6% on the daily average spending figure for November last year.

The latest full monthly data, which shows spending in relation to credit and debit card transactions, reflects the impact of Covid-19 on various sectors.

Spending on restaurants and dining decreased by 23% in October, as further restrictions on indoor dining came into effect during the month, while spending on accommodation has decreased 59% on a year-on-year basis in October.

As restrictions tightened and non-essential retail closed their doors, e-commerce expenditure shot up by nearly 19% compared to October last year. Total e-commerce expenditure amounted to €2.3 billion last month, 44% of all point-of-sale card spending in October.