Financial accounts, Q4 2009

Net holding gains were significant in the last three quarters of 2009. In the three quarters period, the net holding gains amounted to NOK 526 billion for the central government and NOK 52 billion for the households. The accrued net holding loss in the period from the third quarter of 2007 to the first quarter of 2009 was NOK -927 billion and NOK -165 billion for the central government and the households respectively.

Households’ strengthened their financial position

Households and NISHs reduced their borrowing last year. Net lending was calculated to NOK -13 billion in 2009 compared with NOK -36 billion in 2008. Households net holding gains amounted to NOK 38 billion last year. Their net financial assets increased by NOK 25 billion during 2009, and are calculated to NOK 266 billion at the end of the year.

Households’ borrowing fell significantly in the first half of 2009, but the development has flattened out and at the end of the year borrowing recovered slightly. Loans from financial corporations increased and can be explained by more optimistic households. In 2009, the households’ acquisition of quoted shares and mutual funds in particular increased. At the same time, they also net sold bonds and money market fund shares. Bank deposits, notes and coins improved by NOK 23 billion in 2009 compared with NOK 61 billion in 2008. The deposits increased significantly at the end of 2008, partly due to a fall in securities prices and uncertainty concerning the financial turmoil. The moderate increase in bank deposits is probably due to the recovery in security markets and a greater tendency among households to take new financial positions in the markets.

Significant fall in central government’s net lending

Central government’s net lending declined in 2009. This is due to a considerable fall in the State’s income, which was caused by a significant weakening of the oil revenues in 2009. The central government’s net lending was calculated to NOK 277 billion in 2009. This is almost half the amount of 2008 when net lending was NOK 509 billion. In the last year, the central government’s net holding gains amounted to NOK 256 billion, which is a major improvement from the year before when net holding losses were NOK -532 billion. The development led to a top level in central government’s net financial assets. Net financial assets amounted to NOK 3 824 billion at the end of 2009, where NOK 2 637 billion is invested in the Government Pension Fund Global.

Local governments’ net lending improved

The local government’s net lending in 2009 is estimated at NOK -23 billion, compared to NOK -26 billion in 2008. The improvement is due to a decrease in borrowing at the end of 2009. The total borrowing was NOK 34 billion in the last year, which is almost NOK 1 billion higher than in 2008. The local government’s net holding gains amounted to NOK 4.5 billion in 2009, but the negative net lending led to a weakening in the local government’s financial position of NOK 19 billion. At the end of 2009, the local government had a net debt of NOK 132 billion.

Norway’s net financial assets abroad are NOK 2 129 billion

Norway’s net foreign assets were calculated to NOK 2 129 billion at the end of the fourth quarter of 2009. This is up by almost NOK 99 billion from the end of the third quarter of 2009. In the last quarter, Norway’s net lending abroad was NOK 98 billion, while net holding gains due to exchange rate developments in foreign exchange and global security markets were only NOK 0.6 billion in the fourth quarter of 2009.