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High deposit-loan ratio in Norwegian banks
Norwegian banks' deposit-loan ratio fell by 0.6 percentage points from October to November 2012. The deposit-loan ratio has been stable at around 82 per cent in all previous months in 2012.
Norwegian banks' deposit-loan ratio was 82.2 per cent at end-November 2012. This is an increase of 4.1 percentage points from November 2011. Deposits from customers increased by 5.4 per cent during the same period and amounted to NOK 1 802 billion at end-November 2012. Loans from banks were almost unchanged during this twelve-month period, and amounted to NOK 2 191 billion at the end of November 2012.
Loan portfolio movements
Transfers of loans secured on dwellings from banks to mortgage companies issuing covered bonds can contribute to an increased deposit-loan ratio in banks. The deposit-loan ratio in Norwegian banks rose by 19.6 percentage points from November 2008 to November 2012.
The banks' customer deposits as a share of total loans to customers from banks and mortgage companies issuing covered bonds were 56.2 per cent at end-November 2012.
Increasing share of customer deposits in bank funding
Banks finance their operations through different sources of credit, such as deposits, inter-bank loans, bond debt, short-term security loans and loans from the Norwegian Central Bank. Customer deposits are often regarded as the most stable of these funding sources. At end-November 2012 customer deposits in Norwegian banks corresponded to 52.5 per cent of total funding. Compared to November 2011 this is an increase of 1.5 percentage points, and compared to November 2008 an increase of 7.5 percentage points.
| Deposits | Loans from banks | Loans from banks and mortgage companies issuing covered bonds | Deposit-loan ratio banks | Deposit-loan ratio banks and mortgage companies issuing covered bonds | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2012 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| November | 1 801 154 | 2 191 711 | 3 204 982 | 82.2 | 56.2 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| October | 1 805 853 | 2 181 628 | 3 190 768 | 82.8 | 56.6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| September | 1 784 637 | 2 171 905 | 3 178 476 | 82.2 | 56.1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| August | 1 784 530 | 2 182 637 | 3 168 817 | 81.8 | 56.3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| July | 1 789 935 | 2 191 712 | 3 165 511 | 81.7 | 56.5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| June | 1 817 607 | 2 189 774 | 3 156 931 | 83.0 | 57.6 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| May | 1 715 812 | 2 188 578 | 3 146 677 | 78.4 | 54.5 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| April | 1 757 134 | 2 166 923 | 3 115 772 | 81.1 | 56.4 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| March | 1 780 795 | 2 163 900 | 3 102 139 | 82.3 | 57.4 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| February | 1 754 015 | 2 167 764 | 3 083 682 | 80.9 | 56.9 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| January | 1 748 498 | 2 190 752 | 3 083 041 | 79.8 | 56.7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| December | 1 728 065 | 2 185 481 | 3 068 327 | 79.1 | 56.3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| November | 1 708 650 | 2 188 841 | 3 056 964 | 78.1 | 55.9 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The deposit-loan ratio is the amount of a bank's loans divided by the amount of its deposits at any given time. It shows the share of bank lending funded by deposits. |
Norwegian covered bondsCovered bonds are bonds conferring a preferential claim over a cover pool consisting of public sector loans and loans secured on dwellings or other real property. Only mortgage companies with special authorisation may issue covered bonds in Norway, and these bonds have been issued since June 2007. On 24 October 2008, the Norwegian Parliament gave the Ministry of Finance authority to put into effect an arrangement where Norwegian banks could "swap" covered bonds with treasury bills. This "swap agreement" was aimed at reducing the negative effects of the financial crisis. The banks can acquire covered bonds either in the market or directly from mortgage companies that are licensed to issue covered bonds. Since the announcement of this offer by the Norwegian government a number of new mortgage companies have been established. As a result, lending portfolios have been swapped between banks and mortgage companies. |
Tables
The statistics is now published as Banks and mortgage companies.
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