LENDING: Growth in private sector credit slowed to an annual rate of 13.3 per cent in January - the lowest growth since September 1996 - and down from 15.1 per cent in December 2001, according to the latest Central Bank figures.

The average growth in credit for the three months to end January fell to 14.6 per cent from an average rate of 21.6 per cent for the three months to January 2001. Residential mortgage lending rose marginally with an annual rate of growth of 17.9 per cent in January from 17.8 per cent the previous month.

Consumer lending by credit institutions contracted in January with a fall of 0.1 per cent compared to a rise of 1.2 per cent in the same month last year. Total private sector credit fell by €181 million to €129,390 million.

The biggest falls were in term and revolving loans, which fell by €346 million; overdrafts, which were €307 million lower; and loans of up to and including one year, which were down by €227 million. But residential mortgage lending increased by €362 million, a rise of 0.9 per cent when the figure is adjusted for securitisations compared with an increase of 0.8 per cent in January 2001.

Private sector credit weakness in January was not due to erratic items such as lending to IFSC entities and repurchase agreements, according to the Central Bank. If the normally erratic items were stripped out - such as repurchase agreement advances in the month of €273 million compared with a fall of €81 million in January 2001 - the fall in credit would be greater, it said.

Monthly deposit figures show a €53 million increase in Special Savings Incentive Account balances to €291 million in January, while the €945 million fall in overnight deposits was exceeded by increases in notice deposits of up to three months (up €1,229 million) and in deposits of up to two years (up €2,149 million).

Money supply figures showed an increase in the broad M3 measure of €2,346 million or 1.9 per cent over the month.