Personal Bank Deposits In Estonia Seven Times Greater Than Loans

Deposits in Estonian banks have been steadily increasing, so writes Tõnu Toompark on his blog, adaur.ee. Estonian data for February shows a total value of bank deposits of just under 10.5 billion Euros, of which 5.9 billion is held in on request accounts which can be accessed with little or no notice.

Of this total balance, some 4.2 billion euros is held by private individuals, of which 2.1 billion Euros, i.e. about a half, can be readily accessed.

Annual personal loans turnover (constituting home, customer and other loans) peaked in 2007 at the height of the real estate boom, at a level which was the same as the actual balance of deposits (in other words the banks loaned out in 2007 the same amount as they held in deposits – and the total loan balance was more like twice the level that was held in deposits).

However the position by Feburary 2011 was that, in the aftermath of the downturn and severe austerity measures, banks’ much more stringent criteria for granting loans meant that loan turnover had plummeted to a mere 15 per cent of the balance of deposits.

The full article (in Estonian) including graphs plotting changes in loan balance, turnover and the relationship between the two can be viewed here.

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