The total debt (defined as the sum of consolidated stock positions of AF.3 Debt Securities and AF.4 Loans) of the Private Sector1, which peaked in 2012 at €489.2bn, rose by 3.6% during 2014 to stand at €497.8bn by year-end. The threshold of 133 per cent of GDP, set as part of the Macroeconomic Imbalance Procedure (MIP), was exceeded again in 2014. Figure 8 shows the development of Private Sector debt since 2004. The contribution from households to total private sector debt – composed mainly of mortgage-related debt – has maintained a steady decline from its peak in 2008 of €202.7bn, falling by €44.4bn in the intervening period. In contrast, non-financial corporate debt grew by 8.8% in 2014 which drove the overall increase in Private Sector debt.
|S.11 Non-Financial Corporations||S.1415 Households and NPISH||MIP Threshold|
The flow of Private Sector credit (defined as the sum of consolidated transactions in AF.3 Debt Securities and AF.4 Loans) was +13.7 per cent of GDP during 2014. As shown in Figure 9, this was just within the upper threshold of +14 per cent 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 since 2008, cumulatively amounting to €35.0bn, correspond to a net repayment, primarily, of mortgage related debt.
|Total Credit Flow||Upper MIP Threshold||Lower MIP Threshold|
1Defined as the sum of the S.11 Non-financial corporations sector and the S.1415 Households and Non-profit Institutions serving Households sector.
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