ECB: Loans Increased and Deposits Decreased in February

Deposits from households and private non-profit organizations decreased by 396 million euros in February 2025, according to the ECB, compared to a decrease of 1 billion euros the previous month, while the annual rate of change remained almost unchanged at 3.0% from 3.1% the previous month. Additionally, deposits from businesses decreased by 1.3 billion euros during the same month, compared to a decrease of 3.7 billion euros the previous month, and the annual rate of change fell to 9.4% from 10.0% the previous month. Deposits from medium-sized enterprises (MXE) decreased by 1.2 billion euros, compared to a decrease of 3.8 billion euros the previous month. Deposits from insurance companies and other financial institutions decreased by 46 million euros, compared to an increase of 58 million euros the previous month. Consequently, private sector deposits decreased by 1.7 billion euros in February 2025, compared to a decrease of 4.7 billion euros the previous month, with the annual rate of change falling to 4.5% from 4.8%. Meanwhile, government deposits increased by 928 million euros, compared to an increase of 463 million euros the previous month, with the annual rate of change rising to 15.3% from -5.9%. On the lending side, the monthly net flow of funding to businesses was positive at 1.438 billion euros in February 2025, compared to a negative net flow of 1.424 billion euros the previous month, with the annual rate of change increasing to 16.5% from 15.9%. The annual rate of funding for non-financial corporations rose to 16.7% from 15.9%, with their monthly net funding flow being positive at 1.277 billion euros, compared to a negative net flow of 876 million euros the previous month. Overall, the annual rate of total funding for the private sector increased to 10.5% from 10.0%, with the monthly net flow of total funding to the private sector being positive at 1.409 billion euros, compared to a negative net flow of 1.671 billion euros the previous month. Finally, the monthly net funding flow to the general government was negative at 1.416 billion euros, compared to a positive net flow of 290 million euros the previous month, with the annual rate of funding change decreasing to -0.3% from 2.6%.