OREANDA-NEWS. December 23, 2011. The turnover of long-term corporate loans remained at the previous month's level of 145 million euro. No remarkable changes took place in the volume of short-term loans and leasing, either. Lending activity was the most active in the trading sector, which took more short-term loans to finance their stocks in anticipation of soaring sales volumes at the end of the year. Over the past 11 months of this year, traders have received 28% more credit and leasing than a year ago.

The housing loan market showed no relevant changes in November. Whereas the housing loan turnover of 46 million euro was just 5% larger year-on-year, the number of loans issued was smaller in November. Car leasing, on the other hand, has remained active, posting an annual growth of 58%.

The turnover of new loans is still not stopping the shrinkage in the banks' loan portfolio. The stock of corporate and household loans declined by 107 million euro in November, to 14.4 billion euro by the end of the month. The stock of loans and leasing has decreased by 5.3% year-on-year. The forecasted slowdown in economic growth is likely to withhold credit demand in 2012 as well, so Eesti Pank expects the loan and leasing portfolio to contract by 1.4% in 2012.

Loan interest rates also remained almost unchanged in November. The average interest rates on housing loans and long-term corporate loans were 3.4% and 4.4%, respectively.

Overdue loans shrank the most in November. The stock of loans overdue by more than 60 days declined by 59 million euro over the month. By end-November, the share of overdue loans decreased to 5.3% of the loan portfolio. On the one hand, the repayment ability of enterprises and households improved and on the other hand, banks wrote off bad loans.

Deposits increased by 42 million euro in November. The total corporate and household deposit volume was 7.8 billion euro at the end of the month. This is 6% more than a year ago. Irrespective of the relatively low deposit interest rate, households prefer to save in bank accounts due to the high volatility of the financial market. Time deposits have been on the increase throughout the year, so by the end of the month, the share of such deposits was 51%.