Institutional Sector Accounts Non-Financial and Financial 2023

Private Sector Debt

The total debt¹ of the Private Sector² decreased by 6.8% during 2023 to stand at €706.9bn by year-end. The threshold of 133% of GDP, set as part of the Macroeconomic Imbalance Procedure (MIP), was exceeded again in 2023. The decrease in the total debt of the private sector led to a decline in debt as a proportion of GDP, which stood at 138.6% in 2023. Figure 3.1 shows the development of private sector debt since 2013. The contribution from households to total private sector debt – composed mainly of mortgage-related debt – increased during 2023, growing by 2.9% compared to the previous year. However, it continues below its peak of €202.7bn in 2008, falling by €55.2bn in the intervening period.

The debt of non-financial corporations (NFCs) decreased in 2023 by €56.0bn, or 9.1%. The accumulated change between 2015 and 2023 stands at -19.7%. Non-financial corporate debt grew by 66.8% in 2015 which drove the overall increase in private sector debt. This was driven by corporate restructuring both through imports of individual assets and also reclassifications of entire balance sheets in 2015 which meant that the level of capital assets in Ireland increased dramatically compared to 2014 (see National Balance Sheet for Ireland 2015 for further information).

Private Sector Credit Flow /GDP Ratio 2013-2023

The flow of private sector credit (defined as the sum of consolidated transaction liabilities for AF.3 Debt Securities and AF.4 Loans) was -5.7% of GDP during 2023, driven by NFCs. As shown in Figure 3.2, this was well within the threshold of +14% set under the Macroeconomic Imbalance Procedure. A positive credit flow equates to a net incurrence of debt during the year whereas a negative sign indicates a net running-down of debt during the same accounting period. The negative credit flows occurring in the Household sector between 2009 and 2020, cumulatively amounting to -€68.4bn, corresponded to a net repayment, primarily, of mortgage related debt. The period between 2021 and 2023 has seen a positive credit flow, amounting to €10.2bn.

Financial balance sheet of the Non-Financial Corporation Sector split by ownership

A breakdown of the Non-Financial Corporations sector (S.11) financial balance sheet by ownership, along with corporate inversions/redomiciled PLCs, is presented in Table 3.1.

The total liabilities of foreign-owned NFCs, relative to the size of the sector, can be seen in Figure 3.3 (2012 – 2023). In 2023, foreign-owned NFCs make up 57.9% of the NFC sector. Note that the percentage of redomiciled PLCs is 16.1% in 2012 and increases to 27.2% by 2015, this is related to the increase of capital assets in Ireland in 2015, as discussed above.

Net Financial Worth of Non-Financial Corporations 2012-2023 split by ownership

Figure 3.4 shows the Net Financial Worth (BF.90) for S.11 proportioned by ownership (2012 – 2023). The trend shows that before 2015 much of the Net Financial Worth can be attributed almost evenly between foreign and Irish-owned entities, while the substantial change that occurs during 2015 is largely attributed to the foreign-owned NFC group (increasing from 58.7% in 2014 to 74.2% in 2015 of the total Net Financial Worth). In 2023 this proportion stands at 87.7%.