Lending by banks and other credit institutions to private-sector borrowers slowed again in March but mortgage lending increased, according to the latest Central Bank monthly statistics.
Private-sector credit increased by 0.4 per cent or €555 million in March to give an annualised growth rate of 12.7 per cent, the lowest since September 1996.
When residential mortgage lending is excluded, the annual adjusted rate of growth in private-sector credit was 9.7 per cent in March compared with 12.2 per cent in February.
The 12.7 per cent annual adjusted credit growth rate in March compared with annualised growth of 14.2 per cent in February, while the 13.4 per cent average growth for the three months to end-March was down from 15 per cent in the previous three months and 18.6 per cent in the first quarter of 2001. The 0.4 per cent increase in the month compared with growth of 2 per cent in March 2001.
Lending for residential mortgages increased to an annual rate of 18.3 per cent in March from 17.8 per cent in February. After falling steadily from autumn 2000, annualised mortgage lending appeared to have stabilised at around 18 per cent in the four months to end-February. Residential mortgage lending rose 2 per cent in March with €832 million advanced to borrowers, the largest monthly increase since September 2000.
A breakdown of the monthly lending figures showed that term and revolving loans rose by €440 million in March, while overdrafts increased by €358 million and loans up to and including one year fell by just €1 billion.
Irish credit institutions contributed €126 billion of the euro area broad money supply (M3) or 2.3 per cent of the total, according to the March figures. This was an increase of 0.9 per cent on the previous month.
The figures show overnight deposits, mainly current account balances, rose by €638 million in March while deposits of up to two years maturity were up by €375 million. Special Savings Incentive Account (SSIA) deposit balances with credit institutions rose by €69 million in March to €418 million.
