The total outstanding amount of bank debt, which includes bonds issued by banks, stood at €84.4 billion at the end of last year according to figures published by the Central Bank today.
Private debt of the banking sector has been falling rapidly in recent years. Three years ago, the outstanding amount stood at €180 billion.
A surge in debt issuance by banks from around 2003 fuelled the property bubble. Once that bubble burst banks could no longer issue fresh debt. However, as most debt was guaranteed by the State, it was paid off as it fell due.
The outstanding amount of long-term Government debt held by private investors stood at €88 billion at end-December 2012. This represented a year-on-year increase of 3 per cent.
Most of the considerable increase in total Irish debt last year was accounted for by the draw-down of EU-IMF bailout funds.
Despite a marked improvement in international investor sentiment towards Ireland in the middle of 2012, non-resident investors reduced their holdings of long-term Irish Government bonds over the course of the year.
In December 2011 foreigners held 78 per cent of the stock of bonds, but one year later that had fallen to 72 per cent.