Bank placements to the non-banking sector in Croatia continued to decline in September, with this decrease primarily affecting enterprises, reflecting the conditions in the real sector of the economy where there is still no recovery in economic activity, analysts from the Croatian National Bank (HNB) note.
In September, the monthly decrease in placements amounted to 1.8 billion kuna or 0.7 percent, or 0.8 billion kuna or 0.3 percent when excluding the impact of the exchange rate. The HNB states that the trend of gradual deleveraging has been present for more than three years regarding the population, while moderate deleveraging of enterprises has been particularly noticeable in the last few months of this year.
Thus, the September decrease in total placements primarily related to enterprises, and less to the population. In line with the gradual reduction of banks’ credit activity, the annual growth of placements slowed down during 2012 and came to a halt by the end of September. When excluding the impact of the exchange rate and the effect of the Ministry of Finance taking over the shipyard’s debt, the state of placements to the non-banking sector at the end of September was equal to the state at the end of September last year.
In their structure, placements to enterprises continue to grow moderately (2.7 percent), while loans to the population are declining on an annual basis, by 1.8 percent. During September, placements of banks to the central government decreased by 0.9 billion kuna. In the same period, state deposits with banks and the HNB fell by 1.9 billion kuna, resulting in net claims of banks against the state increasing by 1.0 billion kuna that month. The large volume of state financing in the domestic market continues to be reflected in the high annual growth rate of bank placements to the state, which stood at 21 percent at the end of September, according to the HNB.
