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Business sector debt declined by about 0.6 percent to around NIS 790 billion in November. Households' debt in November was NIS 383 billion.
The business sector's outstanding debt
- The total outstanding debt of the business sector declined in November by about NIS 5.2 billion, to about NIS 790 billion.
- The decline derived primarily from a decline of 0.5 percent in the CPI and the shekel's appreciation of 1.8 percent against the dollar, which contributed to a decline in the shekel value of the foreign currency debt. In addition, net debt repayment of about NIS 1.6 billion, primarily of bank loans (NIS 1.2 billion) contributed to the decline.
- In December, the business sector (excluding banks and insurance companies) issued about NIS 4.6 billion of bonds, most of which were tradable bonds. Bond issuances in 2012 totaled NIS 28.6 billion, an increase of about 10 percent from 2011. The monthly average for bond issuances was about NIS 2.4 billion a month.
Households' debt
- Households' outstanding debt in November was NIS 383 billion. The balance of housing debt increased by about NIS 1 billion (0.4 percent), and at the end of November stood at NIS 269 billion. For the full year of 2012, outstanding housing debt increased by NIS 17 billion (6.8 percent).
- New mortgages taken out in December totaled about NIS 4.7 billion. The figure for December is greater than the average per month (NIS 3.8 billion) for the full year of 2012. It is still early to estimate the effect on the housing market of the new directives limiting mortgages, as these directives excluded, until the end of the year, loans which were approved in principle before the directives came into effect.
The cost of the debt
- The spread between interest on credit and interest on unindexed deposits narrowed by about 0.1 percentage points in November, due to a decline in the interest rate on unindexed credit. The spread between interest on credit and interest on indexed deposits was unchanged.
- There was essentially no change from the previous month in the spread between the yield on indexed corporate bonds—measured by the Tel-Bond 60 Index—and average yields on indexed government bonds, which was 1.7 percentage points at the end of November. This, after a the spread had declined by about 1.5 percentage points over recent months.
- In December, the average interest rates on new unindexed mortgages declined by about 0.1 percentage points. The average interest rate on new CPI-indexed mortgages was unchanged.
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