New tables on Central Credit Register statistical information – loans granted by the financial system to private individuals

In October 2010, Banco de Portugal starts the publication of a new set of tables on loans extended by the resident financial system to private individuals, based on the Central Credit Register. This information is included in section B.9 – Central Credit Register statistical information, as well as available through the time series analysis in BPstat | Estatísticas online, and complement the statistical information published since April 2005 on loans granted to non-financial corporations.

The new set of information, available on a quarterly basis, concerns the total credit amount, non-performing loans ratio, number of borrowers and percentage of borrowers with non-performing loans. Tables B.9.2.1 to B.9.2.4 present a breakdown of the private individuals sector between households and non-profit institutions serving households and, in the case of the former, by purpose of the credit (housing and consumption and other purposes).

Sole trading financing represents a particular case of loans granted to private individuals for consumption and other purposes, with the objective of conducting a sole trader economic activity. In this concept are included credit instruments such as financing to the corporate activity and similar, discounting of bills of exchange and other commercial papers, credits on current account, factoring or real estate leasing.

Tables B.9.2.5 to B.9.2.13 present, in the case of the households subsector, detailed information on loans granted by region of residence of the borrower, mainly for the territorial units for statistical purposes (NUTS) of level II (1), and by purpose of the credit. Additionally, time series with the complete breakdown by NUTS II, NUTS III and administrative division (“concelho”) are available in BPstat | Estatísticas online.
 
Finally, Tables B.9.2.14 to B.9.2.16 disclose information on total credit given to households and non-performing loans indicators by bracket of credit amount.

In those tables presenting information on the number of borrowers, it should be noticed that all borrowers with effective credit liabilities are taken into consideration, both for individual and joint credits (in the later case, more than one borrower is responsible for the credit). On the other hand, in the calculation of credit amounts each credit is included only once, irrespective of being an individual or joint credit. Borrowers only holding potential credit liabilities, such as personal guarantees or current accounts and credit cards unused balances are excluded.

Indicators on loans granted to private individuals

At the end of June 2010, total indebtedness of the private individuals sector (2) vis-à-vis the resident financial system reached approximately 155 billion euros, with the households subsector accounting for 98,7% of the total.

The number of private individuals holding effective credit liabilities vis-à-vis the resident financial system was nearly 4,6 million, of which about 13,7% had non-performing loans. At that same date, the number of private individuals registered in the CCR as guarantors reached practically 1,4 million.
 
It is evident the weight of mortgage loans, which represent approximately 78% of the total indebtedness of households vis-à-vis the financial system. This indicator does not show a large variation across regions, with a maximum of almost 80% in the region of Lisbon and minimums of 73% and 76% in the regions of Alentejo and Algarve, respectively.
 
It can also be seen that the region of Lisbon presents the largest number of inhabitants (in relation to the total population over 18 years) with loans extended by the financial system, both for the purpose of housing as for consumption and other purposes. In fact, nearly 64% of adults resident in the region of Lisbon are registered in the CCR as borrowers of individual or joint credit, which compares with a country average of 54%. The regions of Norte and Centro present the lower figures, with 50,4% and 47,5% respectively.

Concerning the breakdown of borrowers in the households sector by level of indebtedness vis-à-vis the financial system, represented by a set of brackets of credit amount outstanding at the end-of-the quarter, it can be observed the predominance of the category from 5 000 to 25 000 euros, comprising approximately 22% of the borrowers, followed by the category from 50 000 to 100 000 euros, which includes 19,8% of the borrowers.

The non-performing loans ratio of the private individuals sector reached 3,2% at the end of June 2010. However, this indicator shows distinctive values when taking into account only loans for housing purposes, with a ratio of 1,9%, or for consumption and other purposes, with a ratio of 7,9%. Within the latter category, the non-performing loans ratio for sole trading financing reached 9,8%. In general, in the period covered in the new tables (March 2009 to June 2010), default credit indicators show an upward trend.

Looking into the breakdown of non-performing loans ratio of the households sector by bracket of credit amount, it can be observed that this ratio is above 13% in the case of the two lower categories (up to 5 000 euros) and that it decreases significantly from 25 000 euros onward, reaching levels between 2% and 4%. This distribution is strongly influenced by the predominance of the mortgage loans in the upper categories, with non-performing loan ratios considerably lower than the ones observed in loans for consumption and other purposes.

The Central Credit Register (CCR)

The CCR, legally supported by the Decree-law no. 204/2008, of 14 October, is an information system managed by Banco de Portugal, comprising the information received from the participants, mainly financial institutions which extend credit (2), and a set of services relating to its processing and dissemination. The CCR contains information on effective credit liabilities (3) held by any private individual or other entity in relation to the participants, irrespectively of being in a regular situation (positive information) or in a default situation (negative information), as well as on potential credit liabilities representing irrevocable credit commitments of the financial system (4).

The main objective of the CCR is to support the participants in the assessment of the risks attached to extending credit. To this end, the participants can access the aggregated credit liabilities of their individual clients, or potential clients (when exists a credit request or an expressed consent), vis-à-vis the financial system. Also according to the legal definition, credit liabilities information may be used by Banco de Portugal for the purposes of supervision of the financial institutions, financial stability analysis, statistical compilation and the conduct of monetary policy and intraday credit operations. 
 

Lisboa, 20  October 2010 

(1) According to the definition set by the Decree-law no. 244/2002, of 5 November.
(2) This sector includes the households subsector and the non-profit institutions serving households subsector.
(3) Namely, banks, savings banks, mutual agricultural credit banks, credit financial institutions, financial leasing companies, credit-purchase financing companies and other financial intermediaries. For the complete list of participants in the Portuguese CCR please refer to the Banco de Portugal’s website or to the Bank Customer Website (available only in Portuguese).
(4) Such as: mortgage loans, loans for the purchase of vehicles, furniture and other consumption goods or services, loans for the acquisition of securities (stocks, bonds, etc.), discounting of bills of exchange and other commercial papers, overdrafts, leasing and factoring operations and credit cards used balances.
(5) Such as personal guarantees granted on the behalf of the participants, as well as the following cases whenever representing irrevocable commitments of the participants: credit cards unused balances, current account arrangements, guarantees granted by the participants, all other credit facilities potentially convertible into effective debt.