Dec 2006 - Dec 2009 Source: Irish Central Bank

The Central Bank said today that credit to non-financial corporations (NFCs), excluding valuation effects, fell by 3.2 per cent over 2009, and has been contracting on an annual basis since July 2009. Household credit, excluding valuation effects, was 1.5 per cent lower in December 2009 compared with December 2008. Residential mortgage lending outstanding (including securitised mortgages) declined by €19 million during December. At year-end 2009, residential mortgages outstanding were 0.3 per cent lower than at year-end 2008.

Headline PSC (private sector credit) declined by 6 per cent in the year ending December 2009. Approximately two-thirds of this annual decline is a result of valuation effects, such as write-downs of loans and increased bad-debt provisions given broader economic conditions, and exchange rate effects as the euro, in general, strengthened during the year. There was a decline in the underlying stock of credit of 2.1 per cent on an annual basis in December.

In December, PSC declined by almost €1.2 billion (0.3 per cent) in December following declines of €2.3 billion and €2.5 billion in October and November respectively.

The headline month-on-month PSC decline in December was mostly due to underlying transactions as repayments were higher than draw-downs during the month. This was in contrast to most months in 2009, where valuation effects rather than underlying transaction, had dominated month-on-month changes through most of the year.

Residential mortgages (including securitised mortgages) declined by €19 million during December. Mortgages outstanding were €147.7 billion at end-December. The annual rate of change in mortgage lending fell to minus 0.3 per cent. Outstanding indebtedness on personal credit cards decreased marginally on a year-to-year basis, being 0.7 per cent lower in December 2009 compared with December 2008. Total repayments were somewhat lower than new spending in December, in contrast to the trend evident through most of 2009.

The combined developments in both mortgage and non-mortgage credit during December left total household credit, adjusted for valuation effects, unchanged during the month. On an annual basis, household credit declined by 1.5 per cent in December 2009, following year-on-year declines of 0.6 per cent and 1.3 per cent in October and November 2009, respectively.

Dec 2006 - Dec 2009 Source: Irish Central Bank