Debt levels are on the up with the Central Bank revealing the amount of credit offered by banks rose by €5 billion last month.
The bank's monthly bulletin for July showed the record demand for mortgages had continued with lending increasing by €1.8 billion.
Following unprecedented levels of borrowing of €2.1 billion in June, new figures showed last month had seen the highest annual growth rate for non-mortgage credit since October 2000.
And as finance institutions line up to offer 100 per cent mortgages, the Central Bank noted it was the first time for five years that non-mortgage credit grew faster than mortgage credit. The bank said demand for non-mortgage lending had been robust.
Demand for private sector credit remained strong in July despite a small dip in the annual rate of growth of 0.2 per cent, to 26.7 per cent.
Residents now owe a total of €231.7 billion. The main contributors to the €5 billion rise in private sector credit were residential mortgages which grew by €1.8 billion, overdrafts which expanded by €182 million and term loans which grew by €1.9 billion.
The annual growth rate for mortgage credit fell to 25.3 per cent last month from an underlying rate of 26.6 per cent in June. This fall was due to base effects arising from strong growth in mortgage credit in July 2004.
It also revealed Special Savings Incentive Account (SSIA) balances with credit institutions rose by €170 million to €5.9 billion at the end of July.
PA