Institutional Sector Accounts Non-Financial and Financial 2014

Excluding the Central Bank (S.121), the balance-sheet of the Other Monetary Financial Institutions sector (S.122+S.123) contracted during the period 2009-2013, where its assets fell by €742.5bn and its liabilities by €752.8bn. During 2014 this trend was reversed as financial assets grew by 6.5% and liabilities by 4.7% over their 2013 values.

The balance-sheet of the non-Money Market Investment Funds sector (S.124) continued to grow during 2014. Figure 10 also shows the change in contribution by S.124 to the overall size of the financial sector balance-sheet. During 2014 this contribution increased in both absolute and in relative terms. Apart from a drop in balance-sheet size during 2008, relating to the financial crisis, the sector has exhibited continuous growth in the intervening period, where its financial assets have grown cumulatively by €1,285.6bn – an increase of 375.9%.

The year-on-year percentage change in total liabilities of the financial sector is illustrated in Figure 11. The corresponding MIP Scoreboard threshold of 16.5% for this indicator is also shown in the same figure. The positive growth between 2004 and 2008 was largely dominated by the expansion of the balance-sheet of the banking sector related to the housing boom. In the ensuing period of 2009-2013 there has been a deleveraging effect in the banking sector which has been offset by significant expansion of the investment funds sector. The marked reverse in trend during 2014 has been caused by simultaneous growth in both the banking and investment funds sectors, although the year-on-year change of 16.0% is just below the MIP threshold. These trends are also shown in Figure 12