Households save record €13.4bn in year to November as pandemic hampers spending

Despite the challenges of Covid-19, businesses are also recording record savings with their deposits the highest on record at nearly €72bn

The impact of coronavirus has continued to diminish individuals’ opportunity and willingness to spend the Central Bank said.

Deposits from Irish households saw record growth in November as the impact of Covid-19 continued to diminish individuals’ opportunity and willingness to spend, the Central Bank has said.

New figures from the financial regulator show Irish households saved a record €13.4 billion in the 12 months to the end of November last year with lodgements exceeding withdrawals by 12.2%.

This is the highest annual increase in household deposits seen since the series began.

Today's figures also show net lending to households increased in November, with households drawing down €72m more than was repaid. 

This contrasts with the same month in 2019, where drawdowns exceeded yearly repayments by €1.9 billion.

Separately, loans for house purchase exceeded repayments by €113 million last November, compared to a net increase of €186 million in November 2019. 

In annual terms, the growth rate remained positive, at 0.8 per cent, down from 1.8 per cent a year earlier.

Annual mortgage lending net flows of €606 million were the lowest since June 2018, the bank added. 

Non-financial corporations

Despite the challenges of Covid-19, businesses are also recording record savings with non-financial corporations (NFCs) deposits the highest on record at €71.8 billion by the end of November 2020, up €12 billion, or 20.8% on the year prior.

The Central Bank said net lending to non-financial corporations (NFCs) turned positive in November, amounting to €178 million during the month. However, on an annual basis, loan repayments exceeded drawdowns by €2.4 billion (6.1%).

Short-term loans continued to drive the annual declines recorded in lending to NFCs, the Central Bank added.