Financial accounts, 3rd quarter 2018:
Local government increasingly in debt
Statistical news from Statistics Sweden and Swedish Financial Supervisory Authority 2018-12-19 9.30
Over the past seven years, local government borrowing has doubled. In the third quarter of 2018, households tightened their increase in debt and financial savings was at the highest level in a third quarter in nearly two decades.
Sweden’s local government is putting itself in debt more than before. The liabilities, measured in issued debt securities and loans, have doubled in the past seven years. In addition to municipalities, local government also includes county councils and certain other municipal units. Previously, loans in banks and housing credit institutions was the most important source of finance, but in recent years, interest in issuing own securities and borrowing in other monetary credit market corporations has increased more rapidly.
Issued debt securities and loans accounts for nearly two thirds of total liability for local government. In all, local government liability via borrowing in issued debt securities and loans amounted to SEK 543 billion at the end of the third quarter of 2018. On the assets side, local government lending amounted to SEK 350 billion, which nearly exclusively consists of further borrowing to the local governments’ own entities.
Source: Statistics Sweden 2018
High level of household savings activity in the third quarter
Households’ financial savings amounted to SEK 29 billion in the third quarter, which is the highest level of financial savings in a third quarter in 18 years. Pension funds reserves and deposits on bank accounts had a positive impact on savings by SEK 43 billion and SEK 30 billion respectively in the third quarter of 2018. One reason for the high level of savings was the continued downturn of growth rate in loans. In the third quarter, the annual growth rate in loans was 5.5 percent, which is the lowest level in four years.
Source: Statistics Sweden
Revisions
In connection with this publication, revisions have been made in the rest of the world sector for 2015–2018. Revisions were made for 2017 with regard to general government.
Definitions and explanations
The financial accounts aim to provide information about financial assets and liabilities, as well as about changes in savings and wealth for different economic sectors. The financial accounts’ financial savings are calculated as the difference between transactions in financial assets and transactions in liabilities. Net lending/net borrowing are measured as the difference between income and costs in the non-financial accounts, which, like the financial accounts, form part of the national accounts. However, financial accounts and real sector accounts are based on different sources, which gives rise to differences.
Publication
The National Wealth, which contains annual data on non-financial and financial assets, is also published in connection with the publication of the Financial accounts. Financial assets and liabilities are collected from the Financial accounts and are thereby consistent with the values published in the Financial accounts.
For further information:
Nationalförmögenheten och nationella balansräkningar (in Swedish) (pdf)
Next publishing will be
The next press release in this series is scheduled for publication on 2019-03-21 at 09.30.
Statistical Database
More information is available in the Statistical Database
Feel free to use the facts from this statistical news but remember to state Source: Statistics Sweden.