Debt burden of Estonians at EUR 7 billion
25.10.2012, 14:50Estonians as private persons owe about EUR 7 billion which is 18.5 times lower than in Finland where the debt burden of private persons is 129.7 billion, writes ERR.
In terms of private sector debt, the debt burdern of the Estonian private sector is less than 10% of GDP. EU’s average debt burden is 85% of GDP.
However, Madis Müller, vice president of Eesti Pank, said that the debt burden coefficient was close to 160% of GDP which, according to the European Commission, is a level that indicates imbalance.
Speaking of how fast Estonia’s debt burden coefficient reached EU’s average, Müller said:
„It was the rapid growth in loan burden so it was one-off consequence of the economic boom which is unlikely to happen again,” said Müller.
Müller added that as interest rates remained low, it was difficult for banks to earn income and could force them to increase risks.
In September the loan portfolio of Estonian resident corporations was 2% higher than at the beginning of the year but 1.5% less than at the end of 2011.
Banks said their loan portfolio in September increased 0.6% in September.
The volume of deposits remained unchanged, but is 6.1% higher than at the beginning of 2012.