Citizens and Companies Owe the Banks 9.87 Billion Euros: Loans Up 14.1 Percent, Deposits Only 9.2

As of September, citizens and companies together owe the banks 9.87 billion euros. Of that, citizens owe 4.93 billion and companies 4.90 billion euros. In September alone total debt grew by 1.3 percent, and year on year by 14.1 percent - 15.7 percent for companies, 12.7 percent for households. That's according to the latest figures from the National Bank.

At the same time, deposits are growing more slowly - 9.2 percent a year, to 11.15 billion euros, of which 7.5 billion belong to citizens. The gap of almost five percentage points says something simple: we're borrowing faster than we're saving.

Housing loans are growing fastest - 16.1 percent in one year. Consumer loans are up 12.4 percent. But a smaller number says the most: negative balances on current accounts, the overdraft the bank hands you when your salary doesn't stretch to the end of the month, jumped 5.8 percent in September - in a single month.

The rise in housing loans doesn't necessarily mean more people are buying flats. When flat prices rise, so does the amount you have to borrow to buy one. For many families, a home of their own means a monthly instalment to the bank for the next 20 or 30 years, at an average lending rate of 4.67 percent in August.

The National Bank is reacting. From December 1, the repayment period for a second or any further home drops from 30 to 25 years, mortgage loans are capped at 15 years, and the maximum share of salary that can go to an instalment falls from 50 to 45 percent for denar loans and from 45 to 40 percent for euro loans. For a first home, the term stays at up to 30 years.

The measure is reasonable - but it treats the consequence. When loans grow faster than savings, the question isn't only how long we'll be paying them off, but why we need so much credit for basics like a roof over our heads. That question isn't the central bank's to answer. It's the government's.