Financial corporations, balance sheet, August 2011

Total loans from Norwegian banks and mortgage companies to Norwegian households amounted to NOK 1 927 billion at the end of August 2011. Loans secured on dwellings represent 85.7 per cent of these total loans. At end-August, loans secured on dwellings amounted to NOK 1 651 billion; an increase of 7.1 per cent from the corresponding period last year.

Growing share of credit lines

Loans secured on dwellings can be divided into repayment loans and credit lines. Repayment loans account for most of the loans secured on dwellings, but credit lines have increased in importance relative to repayment loans since their introduction in January 2006. At end-August this year, credit lines accounted for 26.8 per cent of total loans secured on dwellings.

Highest growth rate in credit lines

At end-August, credit lines secured on dwellings to households amounted to NOK 442 billion.

This is an increase of NOK 51 billion, or 12.9 per cent, compared to the corresponding period last year. Repayment loans secured on dwellings have increased from NOK 1 150 billion in August 2010 to NOK 1 209 billion in August this year. The 12-month growth of 5.1 per cent is the highest growth rate observed since January 2010.

Increasing loans from the mortgage companies

Loans secured on dwellings are offered by both banks and mortgage companies. During the last years, loans secured on dwellings from mortgage companies to households have gradually increased compared to loans from banks. At end-August, loans from mortgage companies were NOK 805 billion, which is 48.8 per cent of the total loans secured on dwellings to households. Loans from banks, however, were NOK 846 billion. During the last 12 months, mortgage companies have increased their loans secured on dwellings by nearly NOK 128 billion, while the equivalent loans from banks have decreased by NOK 18 billion. Portfolio movements from banks to mortgage companies, which are a result of the introduction of covered bonds, may be a major reason for the rise of loans from mortgage companies and the decrease of such housing loans from banks.

At end-August this year, loans secured on dwellings from mortgage companies constituted 54.9 per cent of total loans secured on dwellings. In February 2011, mortgage companies’ share of credit lines exceeded the banks’ share of credit lines. For repayment loans to households however, banks constituted the largest part of the loans; a share of 53.5 per cent in August this year.