OREANDA-NEWS. October 20, 2011. In the second quarter the financial position of households improved, owing to the continued growth in deposits. The loan liabilities of non-financial corporations decreased by 50 million euros while the deposits increased by approximately 92 million euros, owing mainly to the growth of foreign deposits, reported the press-centre of Eesti Pank.

In contrast to the previous two quarters repayments of foreign loans exceeded the volume of new loans and domestic liabilities grew due to increased borrowing. However, the stock of domestic debt was approximately 5 per cent lower and foreign debt 6 per cent higher compared to the previous year. Over the year the share of foreign debt has increased by 2 percentage points to 26 per cent. As in the first quarter, the trade credit of companies vis-a-vis the rest of the world increased significantly (more than 200 million euros), owing to the strong increase in exports.

In the second quarter the financial position of households improved further, owing to the continued growth in deposits. The financial assets of households increased due to the growth of deposits by approximately 200 million euros. The rise in assets was reduced by a decrease of 110 million euros in the value of securities. In contrast to previous quarters, loan liabilities remained broadly unchanged as borrowing increased in the spring. In total, the loan liabilities of households have decreased by 8.2 per cent since the peak at the end of 2008.

Public sector's assets increased. The deposits of the public sector grew in the second quarter by 84.5 million euros. Equity investments increased by approximately the same amount.

In the second quarter of 2011 the Estonian economy as a whole was a net lender vis-a-vis the rest of the world (22 million euros). In the first quarter households and the public sector were the net lenders and non-financial corporations and financial institutions were the net borrowers.