Private sector borrowing eased in March back from record levels set in recent months.
However mortgages continued to grow strongly, according to figures published by the Central Bank today.
Growth remained extremely strong, with adjusted annual growth at 29 per cent in March, down from 29.4 in February.
Borrowing increased by €3.5 billion over the month, bringing outstanding credit to €271.4 billion.
The change in credit was affected by what the bank described as a "significant fall" of €1.1 billion in lending to companies in the IFSC other than banks, due to maturing term loans.
However, the slowdown in private sector credit growth was not reflected in mortgage credit.
Residential mortgages increased by €2.1 billion in March, the third highest increase on record. The headline year-on-year adjusted growth rate reached 29.8 per cent in March, from 29.6 per cent in February.
This strong demand for residential mortgages takes place against a background of a rapid increase in the building of new houses. Nearly 22,000 houses were completed in the first quarter of 2006.
Following the increase in ECB official interest rates announced on March 2nd, 2006, market interest rates grew firmer across all terms during March, with the overnight rate rising by 22 basis points, the three-month rate by 16 basis points and the 12-month rate by 25 basis points.
