Graphs & Data
Business sector debt declined by about 0.1 percent to around NIS 817 billion in October. Household debt increased by about NIS 3.1 billion (0.7 percent) to around NIS 431 billion at the end of the month.
The business sector’s outstanding debt
· The total outstanding debt of the business sector declined by about NIS 0.7 billion (0.1 percent) to around NIS 817 billion in October[1]. The decline derived mostly from net repayment of bank loans totaling about NIS 7 billion, following two months of net raising of debt from the banks. The decline was partially offset by a depreciation of about 2.4 percent in the shekel exchange rate vis-à-vis the dollar, and by an increase 0f 0.3 percent in the Consumer Price Index. These increased the shekel value of CPI-indexed debt, and of the debt indexed to and denominated in foreign currency.
· In November, the business sector (excluding banks and insurance companies) issued about NIS 0.9 billion in bonds, all of which were tradable bonds. This was significantly lower than the average amount of issuances over the first ten months of the year, which is about NIS 2.7 billion per month.
Table 1: The Composition of Business Sector Debt
Figure 1: Rate of Change (Year on Year) in the Business Sector's Bank and Nonbank Debt
Table 2: Debt by Indexation
Figure 2: Business Sector Bond Issuance
Household debt
- Households’ outstanding debt increased by about NIS 3.1 billion (0.7 percent), to about NIS 431 billion, in October. Of that, the balance of outstanding housing debt increased by about NIS 1 billion, to about NIS 300 billion at the end of October. Since the beginning of the year, total housing credit has increased by about 4.2 percent.
- In November, there was an increase in new mortgages taken out, with the total reaching about NIS 4 billion (see Figure 3). The average over the first ten months of the year is about NIS 4.2 billion per month.
Table 3: Outstanding Debt Balances of Households
Figure 3 :Total Housing Credit from Banks, According to Indexation: New Mortgage Volume
The cost of the debt
· In the CPI-indexed track, the spread between the interest rate on new bank credit granted and the interest rate on deposits increased by about 0.12 percentage points in October, compared with the previous month.
· In October, the average spread between the yield on CPI-indexed corporate bonds—measured by the Tel Bond 60—and the yields on CPI-indexed government bonds expanded by about 0.05 percentage points to about 1.49 percentage points. In November, this spread narrowed by about 0.03 percentage points.
· In November, the average interest rate on new unindexed mortgages (variable-rate interest) declined by about 0.07 percentage points. The average interest rate on new CPI-indexed mortgages (fixed interest) declined by about 0.04 percentage points.
Table 4: The Cost of the Debt
Figure 4 : Spread between Indexed Corporate Bonds (Tel-Bond 60) and Indexed Government Bonds (monthly average)
Figure 5 : New Housing Loans from Banks – Interest Rates
in the Unindexed Sector
Figure 6 : New Housing Loans from Banks – Interest Rates in the CPI-indexed Sector
For links to Data and Statistics on the Bank of Israel website:
[1] As of June 2014, the balance of outstanding loans from nonresidents to the business sector was revised upward by about NIS 16 billion, due to the addition of new companies to the report. The outstanding balance shown before June 2014 will be integrated retroactively over the course of 2015 in accordance with the revision policy.