Huge net holding gains in 2009

The central government and households both had huge holding gains in 2009. The central government’s holding loss since autumn in 2007 has been reduced by almost 60 per cent during 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.

Source:  Norway Statistics