In the 3^rd quarter of 2021

Default ratios of the non-financial corporations and households decreased, while the balance of credit granted increased from the previous quarter

According to the data released by the Bank of Portugal, at the end of the 3^rd quarter of 2021, the balance of credit granted to non-financial corporations located in the Autonomous Region of Madeira stood at 2.1 billion euros, 183.8 million euros higher than at the end of September 2020 and up by 95.9 million euros over June 2021. This is the highest value since November 2016.

The default ratio of this type of corporation decreased by 0.3 percentage points (pp) over the previous quarter, standing at 1.9% at the end of the reference period. Compared to the same quarter of the previous year, there was a 4.4 pp reduction. It should also be noted that this ratio is the lowest since March 2009. On a national level, the overdue loan ratio also decreased by 0.3 pp from the previous quarter and by 1.4 pp over the same period of the previous year, standing at 2.6% at the end of the 3^rd quarter of 2021. It should be noted that the regional ratio remains below the national ratio for four consecutive months. The amount of non-performing loans within non-financial corporations headquartered in the Region stood at 40.0 million euros in the reference period (- 3.3 million euros than last June and - 79.7 million euros compared to September of the previous year).

The percentage of borrowers in the non-financial corporations sector with non-performing loans at the end of September 2021 was 14.3%, with this indicator remaining below the national average (15.3%) since July 2020. However, in June 2020, the difference between the Region and the country was 0.6 pp (unfavourable to the Autonomous Region of Madeira).

In the Household and Non-Profit Institutions Serving Households (NPISH) sectors, there was a year-on-year increase of 46.4 million euros in the balance of loans granted, bringing the balance of loans to this institutional sector in September 2021 to 3.2 million euros. When comparing the balance at the end of the 3^rd quarter of 2021 with that of the previous quarter, there was also an increase of approximately 35.8 million euros. 66.5% of the balance of credit granted was related to the “housing” segment and the remaining 33.5% to “consumption and other purposes".

Overdue loans in the housing segment did not exceed 14.4 million euros, representing a ratio of 0.7%,  thus maintaining the historical minimum for the available series, which began in March 2009, already recorded at the end of the previous quarter. This percentage stands 0.5 pp above the national value. Compared to September 2020 the ratio dropped by 0.1 pp in the Region.

The number of borrowers in the Household and Non-Profit Institutions Serving Households (NPISH) sectors grew from the previous quarter to 100.1 thousand, 44.3 thousand borrowers with housing loans and 83.4 thousand with consumer credit and other purposes.

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