consumer credit market in europe at end 2010
DESCRIPTION
CA Consumer Finance shares the findings of its survey of the consumer credit market in 27 European Union countries (EU-27) for the fourth year running. With a total of 1,105 billion euros in loans outstanding at end-2010, the EU accounts for nearly one quarter of the global credit market.TRANSCRIPT
Page 1 Consumer credit in Europe at end-2010
Consumer credit in Europe Consumer credit in Europe at endat end--20102010
Consumer Credit Overview
June 2011
Page 2 Consumer credit in Europe at end-2010
Summary (1/2)Summary (1/2)
Consumer credit in Europe at endConsumer credit in Europe at end--20102010
With €1,105 billion in loans outstanding at end-2010 (see page 4), the European Union accounts for nearly one quarter of the world consumer credit market.
Outstandings remain unevenly distributed, with five countries (UK, Germany, France, Italy and Spain) representing 76% of total outstandings (but 63% of the EU population). The EU can be divided into three zones: Northern Europe, with 56% of loan outstandings (and 41% of the EU population);
Southern Europe (including France), with 37% of outstandings (39% of EU population);
Eastern Europe, with 7% of outstandings (20% of EU population).
The European consumer credit market continued to contract in 2010 (see page 6), with outstandings falling 2.8% between December 2009 and December 2010: Northern Europe: -3.0% between 2009 and 2010 Southern Europe: -2.4% between 2009 and 2010 Eastern Europe: -3.9% between 2009 and 2010
The overall pattern conceals contrasting trends (pages 5 & 6): Some markets reported a strong decrease in outstandings, including Ireland (-17%), Spain (-11%) and the UK (-6%). In contrast, other markets have proved resilient, such as Slovakia (+9%) and Belgium (+2%).
Page 3 Consumer credit in Europe at end-2010
At end-2010, average outstandings per inhabitant (page 7) in the European Union totalled €2,220, down 3% on the 2009 total (€2,290). A decrease was observed in almost all European countries.Strong disparities exist within the EU, with outstandings per inhabitant ranging from €270 in Lithuania to nearly €4,500 in Ireland (although this figure contracted by a considerable 17% in 2010).The share of loan outstandings in total household debt is 17% in the EU.
The ratio of outstandings to total annual household consumption (page 8) sheds light on the real share of credit in consumption. This indicator helps to eliminate the disparities resulting from differences in the standard of living from one country to the next.Outstandings at end-2010 account for 15.4% of total annual household consumption in EU27, compared with 16.4% in 2009. This metric supplies a structural assessment – looking beyond today’s crisis – of: the maturity of certain countries: UK (22.4%), Bulgaria (21.7%) ; the lower use of consumer credit in other countries: France (13.2%), Italy and Portugal (12.3%).
The French consumer credit market occupies a particular place in EU27: At end-2010, outstandings came to €151.7 billion, or 14% of the EU total.
It is the third-biggest EU market in terms of outstandings, far behind the UK (€249 billion) and Germany (€229 billion) but ahead of Italy and Spain.
The ratio of outstandings to total annual household consumption is 13.2% in France, compared with the 15.4% average for the EU. Loan outstandings account for 17% of the total debt of French households, identical to the EU average.
Summary (2/2)Summary (2/2)
Consumer credit in Europe at endConsumer credit in Europe at end--20102010
Page 4 Consumer credit in Europe at end-2010
MethodologyMethodology
Source: The data for this study come from central banks and have been restated by the Asterès consulting firm to ensure consistency in the markets and products being compared.
Due to the lack of definitive annual figures for several countries, certain data are based on estimates.These data concern all lenders, banks and specialised credit institutions.Data on products include bank overdraft facilities but exclude mortgage loans.To compare eurozone and non-eurozone countries, outstandings in the non-eurozone countries were converted on the basis of average 2010 exchange rates.
Some figures on outstandings and changes therein may differ from those in previous editions of this study, for two reasons in particular: revisions to the primary data provided by the central banks;
fluctuations in the exchange rates used to convert outstandings in foreign currencies into euros. This second reason is particularly important, inasmuch as the financial crisis caused some extremely sharp currency movements.
For France, the data were updated on the basis of outstandings published by Banque de France, restated for estimated outstandings in Overseas Departments, for a total €151.7 billion at end-2010.
For the fourth consecutive year, this consumer credit overview of the 27 countries in the European Union endeavours to measure:1- The level of outstandings per country at end-20102- Annual trend reported since 20093- The level of loan outstandings per inhabitant 4- The economic weight of consumer credit
Consumer Consumer creditcredit in Europe in Europe atat endend--20102010
We used two concepts to quantify consumer credit usage. Production: the total amount of credit issued in one year; this figure represents a flow. Outstandings: at a given point in time, the sum of the loans granted to individuals that still need to be repaid; this figure represents an inventory.
Page 5 Consumer credit in Europe at end-2010
249
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35,7 35,1 27,5 24,7 17,5 16,0 15,3 14,3 12,5 10,6 5,1 4,8 3,4 2,8 2,5 1,1 0,9 0,9 0,7 0,4
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€€1,105 billion in consumer credit outstanding at end1,105 billion in consumer credit outstanding at end--2010 2010
Sources: central banks, Asterès *Asterès estimates
1 Consumer credit in Europe at end1 Consumer credit in Europe at end--20102010
Consumer loan outstandings for the 27 countries in the European Union came to €1,105 billion at end-2010.Outstandings were unevenly distributed: the top five markets in terms of outstandings (UK, Germany, France, Italy and Spain) accounted for 76% of total outstandings (higher than in 2009). These five countries are home to 63% of the EU’s population. The European market can be divided into three zones: Northern Europe: with 56% of loan outstandings in the EU (41% of EU population) Southern Europe: 37% of outstandings (39% of population) Eastern Europe: 7% of outstandings (20% of population)
Page 6 Consumer credit in Europe at end-2010
Consumer loan outstandings fell 2.8% between December 2009 and December 2010. The macro-economic environment remained unfavourable generally, with economic growth lacklustre in most Member States. Household consumption was curbed by the budgetary rigour policies introduced by a number of European countries in response to the sovereign debt crisis in Greece, Ireland and Spain. In addition, unemployment remains high (9.5% of the active population at the end of the year), denying some households access to credit.
Of Europe’s top five markets in terms of outstandings, only France (+1.7%), Italy (+0.9%) and Germany (+0.5%) were resilient. With outstandings up 8.7%, Slovakia was a notable exception to the overall downward trend in the consumer credit market in Europe.
OutstandingsOutstandings rose in 8 countries rose in 8 countries onlyonly
2.1 Consumer 2.1 Consumer creditcredit in Europe in Europe atat endend--20102010
Country Change 2009 / 2010
Slovakia 8.7%
Belgium* 2.0%
France 1.7%
Netherlands 1.2%
Poland 1.1%
Italy 0.9%
Germany 0.5%
Finland 0.4%
Sources: central banks, Asterès *Asterès estimates
Page 7 Consumer credit in Europe at end-2010
-2,4%
-3,0%
-3,9%
Southern Europe Northern Europe Eastern Europe
Ireland, beset by a serious banking and budgetary crisis, reported the biggest fall in consumer loan outstandings in the European Union (-17%) behind Cyprus (-29%).
Concerning new Member States: - the decrease in outstandings was particularly marked in Romania (-12%), the Czech Republic (-10%) and the Baltic states. - these negative trends contrasted significantly with the positive performance of the markets in Poland (+1.1%) and Slovakia (+8.7%, the highest increase in the EU).
Outstandings were down 5.7% in the leading EU market, the UK.
Changes are calculated on the basis of outstandings totals in local currency
2.8% drop in 2.8% drop in outstandingsoutstandings in EU27in EU27
2.2 Consumer credit in Europe at end2.2 Consumer credit in Europe at end--20102010
Sources: central banks, Asterès *Asterès estimates
Country Change 2009 / 2010
Bulgaria -4.3%
Austria -0.2%
Hungary -0.3%
Sweden -0.5%
Luxembourg -0.8%
Malta -1.0%
Greece -2.5%
EU27 -2.8%
Slovenia -2.9%
Portugal -3.0%
Country Change 2009 / 2010
UK -5.7%
Denmark -8.4%
Latvia -10.0%
Lithuania -10.0%
Czech Republic -10.0%
Estonia -10.2%
Spain -10.7%*
Romania -11.8%
Ireland -17.0%
Cyprus -28.9%
Page 8 Consumer credit in Europe at end-2010
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Consumer loan Consumer loan outstandingsoutstandings per inhabitant (in per inhabitant (in euroseuros))
At end-2010 average outstandings per inhabitant in the EU stood at €2,220, down 3.1% on 2009 (€2,290).The EU consumer credit market is characterised by strong disparities between countries, mainly owing to differing levels of economic development: In Ireland, outstandings per inhabitant fell sharply (down 17% on 2009) but remained the highest in the EU at €4,470.
Differences remain considerable in the eurozone. Outstandings per inhabitant are relatively high in Germany, at €2,800, but much lower in Italy (€1,890) and Portugal (€1,340).
In most new Member States (joining since 2004) outstandings per head are under €1,000: Poland (€940), Romania (€710), Bulgaria (€640). Poland and Slovakia were the only two countries in Eastern Europe to observe a rise in outstandings per inhabitant in 2010.
3 Consumer credit in Europe at end3 Consumer credit in Europe at end--20102010
Sources: central banks, Asterès *Asterès estimates
Page 9 Consumer credit in Europe at end-2010
24,6%
22,4%21,7%
20,5%20,0%
16,4%16,2%
15,8%15,4%
15,3%14,5%
14,3%
13,2%12,9%
12,3%12,3%
10,9%
8,5%8,0%
6,4%
5,1%
9,5%9,7%9,8%10,3%
13,8%
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Ratio of consumer loan Ratio of consumer loan outstandingsoutstandings to household consumption in 2010to household consumption in 2010
At end-2010 the ratio of outstandings to total annual household consumption was 15.4% in the EU compared with 16.4% a year earlier. The ratio increased sharply in Bulgaria and Slovakia. One of the sharpest drops was seen in Ireland, down from 28.4% at end-2009 to 24.6% at end-2010.In France, outstandings represented 13.2% of household consumption (compared with 12.6% at end-2009), a ratio that is considerably lower than the European average.
4.1 Consumer credit in Europe at end4.1 Consumer credit in Europe at end--20102010
Sources: central banks, Asterès *Asterès estimates
Page 10 Consumer credit in Europe at end-2010
16,4%15,4%
2009 2010
GermanyGermany
FranceFrance
16,1% 15,8%
2009 2010
17,3%
14,5%
2009 2010
12,5% 12,3%
2009 2010
13,3% 13,2%
2009 2010
Trend in ratio of consumer Trend in ratio of consumer loanloan outstandingsoutstandings to to householdhousehold consumptionconsumption 2009/2010 2009/2010
4.2 Consumer 4.2 Consumer creditcredit in Europe in Europe atat endend--20102010
Sources: central banks, Asterès *Asterès estimates
EuropeanEuropean UnionUnion
24,9%
22,4%
2009 2010
UnitedUnited--KingdomKingdom
SpainSpainItalyItaly
Page 11 Consumer credit in Europe at end-2010
With outstandings under management of €78.1 billion at end-2010, Crédit Agricole Consumer Finance is the European leader in consumer credit.
Crédit Agricole Consumer Finance is present through its subsidiaries in 19 European countries (Germany, Austria, Belgium, Denmark, Spain, Finland, France, Greece, Hungary, Italy, Norway, Netherlands, Poland, Portugal, Czech Republic, UK, Slovakia, Sweden and Switzerland) and also in Saudi Arabia, Morocco and China.
At end-2010, two-thirds of its outstandings under management came from international activities.
Sofinco is a French brand of Crédit Agricole Consumer Finance.
CrCréédit Agricole Consumer Financedit Agricole Consumer Finance the the EuropeanEuropean leader in consumer leader in consumer creditcredit
Consumer Consumer creditcredit in Europe in Europe atat endend--20102010
Page 12 Consumer credit in Europe at end-2010
Contact : Crédit Agricole Consumer Finance
D.P.C.I.
H.0.2. - rue du Bois Sauvage - 91038 Evry cedex
Tél. : + 33 (0)1 60 76 88 17
E-mail : [email protected]
Consumer Credit in Europe at end-2010
All Crédit Agricole Consumer Finance ‘s studies are available from www.ca-consumerfinance.com, Section Consumer Credit Overview