Estonian economy was net lender again in Q3

Photo: Sille Annuk

The Estonian economy as a whole emerged again as a net lender in the third quarter of 2012 with a total outbound amount of 23 million euros, the Bank of Estonia said.

"If businesses were net borrowers for the second quarter running then all other sectors were net lenders," Taavi Raudsaar, lead specialist at the central bank's financial sector policy sub-department said.

The reduction in the borrowings of households has come to a halt, with the sum total of loan obligations of households moving up 0.5 percent in the third quarter compared with the preceding three-month period, the central bank said.

"The volume of debt obligations due to domestic financial institutions was by and large unchanged from the second quarter, yet households' obligations before domestic non-financial enterprises and the world outside grew," Raudsaar said. "In year-on-year comparison the volume of households' debt obligations nevertheless still decreased by 1.4 percent."

The rate of year-on-year growth in the debt obligations of companies in the third quarter was 5 percent. The sum total of money raised by companies at home and abroad by borrowing and issuing bonds increased by more than 350 million euros during the quarter, reaching 16 billion euros. Debt obligations assumed abroad accounted for one-third of the increase.

Financial assets of households grew 11 percent year on year and those of businesses 13 percent year on year in the third quarter.

General government debt increased by 500 million euros in the third quarter to 1.8 billion euros mainly as a result of a loan taken from the European Investment Bank. With the credit raised from EIB projects based on external finance would be co-financed.