The level of loans to non-bank clients at the end of 2021 reached PLN 1,379 billion. The 5.1% y/y growth was a clear recovery from the slowdown caused by the pandemic (in 2020 the annual growth rate was 0.7%), the dynamics returned to the level from 2019 (5.0% y/y). The growth was driven by PLN housing loans and corporate loans.
After falling by 5.0% last year, loans to non-financial businesses grew by 2.9% at the end of 2021. The positive dynamics were driven by a change in the trend in loans to corporates, which increased by 4.2% y/y against a decline of 4.9% y/y at the end of 2020. Similarly to the previous year, negative dynamics continued in loans for individual entrepreneurs and farmers (-1.7% y/y and -2.0% y/y respectively).
The improvement in the current epidemic and economic situation was reflected in an increase in working capital loans for both businesses (to 14.2% y/y against -15.1% at the end of 2020) and individual entrepreneurs (to 0.8% y/y against -8.0% y/y at the end of 2020). However, the economic recovery observed in the short term did not affect the investment mood of enterprises, which translated into negative dynamics of investment loans for both enterprises and individual entrepreneurs (-2.1% y/y and -4.9% y/y respectively).
The volume of loans to individual customers increased by 5.8% y/y compared with an increase of 4.5% at the end of 2020. This increase was driven, on the one hand, by rapidly growing PLN housing loans (12.5% y/y vs. 10.1% y/y at the end of 2020) and, on the other hand, by positive consumer loans growth of 2.1% y/y (vs. a decline of -2.1% y/y at the end of 2020). At the same time, the volume of FX housing loans fell by -7.9% y/y (+0.2% y/y at end-2020) in an environment of PLN depreciation against CHF.
The increase in PLN housing loans occurred as a result of the continuing high demand for real estate stimulated by the low level of interest rates. At the same time, due to the continuing trend of rising property prices, the amounts of loans granted also increased. According to the Credit Information Bureau (BIK), the average value of a home loan applied for in December 2021 was 10.8% higher y/y.
The continuation of the upward trend in consumer loans was due to, inter alia: banks loosening the criteria and conditions for granting consumer loans in connection with the improvement of the economic situation of households and increased demand resulting from the need to finance durable goods. According to BIK, high value loans (i.e. over PLN 30 thousand) accounted for the largest share in the sales of cash loans.
At the end of 2021, deposits from non-bank customers increased by 10.9% y/y, compared with 13.8% at the end of 2020. This slowdown was caused by a sharp decline in the growth rate of deposits from non-financial businesses. At 10.3%, it was more than twice as low as at the end of 2020 (22.0%). This decrease was mainly due to a high base effect related to the distribution of Financial Shield funds, which occurred mainly in the second quarter of 2020.
The dynamics of deposits from individual customers amounted to 6.1% y/y and was also lower than in December 2020 (8.1%). Despite the cycle of interest rate increases initiated by the MPC, in October 2021, it did not translate into an increase in deposit interest rates due to the persistently high excess liquidity in the sector. Real interest rates on deposits remained negative due to high inflation. The decrease in dynamics was also influenced by the increase in consumer spending of individual customers and the conversion of funds to investment products with higher risk or guaranteeing at least partial hedging against the effects of inflation. This has resulted, among other things, in an increase in the popularity of so-called savings bonds. Their average monthly sales in 2021 amounted to PLN 3.6 billion, while in 2019 they exceeded only PLN 1.4 billion per month. Strong interest in higher risk investments continued, including: in the housing market, as well as in the capital market. The assets of the investment funds (excluding PPK funds) increased by PLN 6.2 billion in 2021.
No increase in interest rates on time deposits following the interest rate increases contributed to maintaining the structure of deposit growth. At the end of 2021, current deposit growth remained positive at 14.6% y/y (compared to 28.8% at the end of 2020). Retail term deposits fell y/y by 21.7%, but it was a weaker decline than at the end of 2020. (-29.3% y/y).