According to the latest data from Bank of Portugal, at the end of the 1st quarter of 2022, the balance of the volume of loans granted to non-financial companies (NFCs) was 2.1 billion euros, 98.6 million euros more than at the end of March 2021 and 21.7 million euros more than in December 2021. And, now the Regional Directorate of Statistics (DREM) from Madeira released its analysis of these figures, highlighting them as another indicator of market confidence among consumers.

This is because “the overdue credit ratio for this type of company increased 0.4 percentage points (p.p.) in relation to the end of 2021 at 2.4% at the end of the reference period”, the directorate stresses,  but “compared with the same quarter of the previous year, there was a reduction of 1.2 p.p.”,. “On a national level, the overdue loans ratio fell 0.1 p.p. in comparison with the previous quarter and 1.1 p.p. in homologous terms, not exceeding 2.2% at the end of the first quarter of 2022”.

It should be noted that “the amount of non-performing loans (NPL) among non-financial companies, headquartered in the Region [Madeira], stood, in the period in question, at 49.0 million euros (+8.1 million euros than last December and -22.3 million euros compared to March of the previous year)”, which can still be seen as a warning sign to be taken into account.

In the case of debtors in the NFC sector (companies) with overdue loans, at the end of March 2022, the percentage “was 14.4%, and this indicator has remained below the national average (15.0% in the same period) since July 2020,” says the DREM.

“In the sector of households and Non-Profit Institutions Serving Households (NPISHs) there was a year-on-year increase of € 62.6 million in the balance of loans granted, bringing it to € 3.2 billion at the end of the 1st quarter of 2022,” it reveals. “When the balance is compared with the previous quarter, there is also an increase of around €35.5 million. If the analysis is more detailed, it can be seen that 67.5% of that balance referred to the housing segment and the remaining 32.5%, to consumption and other purposes”, the document explains.

With regard to non-performing loans (NPL) “in the housing segment, these did not exceed €11.9 million euros, representing a NPL ratio of 0.5%, thus maintaining the historical minimum for the available series, which began in March 2009. This percentage is slightly above the national value (0.4%). Between March 2021 and March 2022, the ratio of overdue housing loans ratio was reduced by 0.3 p.p. in the Region” of Madeira, the DREM guarantees.

To attest to this good wave of banking, “the number of debtors of the institutional sector households and NPISHs grew in relation to the previous quarter to 100.100, and at the end of the 1st quarter of 2022, there were around 44,400 debtors with mortgages and 83,500 with consumer credit and other purposes”, almost double.

Original Story:  Diário de Notícias Madeira  | Francisco José Cardoso 
Photo: Photo by Svilen Milev in FreeImages
Edition & Translation: Prime Yield