Loan growth slowing down

Faroese banks are lending out less money than they used to, according to the Governmental Bank of the Faroe Islands.

There was a steady loan growth between 2014 and 2018, but this growth reached the zero mark on 31 December last year.

Faroese banks lent out a total of DKK 15.6 billion last year, of which DKK 8.8 billion went to households.

Households in this context includes wage earners, pensioners, self-employed traders and non-profit organisations such as sport clubs.

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Faroese households appear to be turning to Danish mortgage providers to meet their mortgage needs.

Loans from Danish mortgage providers to Faroese households increased by just under 15 percent at the end of 2019 compared to the previous year.

According to the Governmental Bank of the Faroe Islands, this may be due to the low interest rates.

Faroese households owe DKK 2.9 billion to Danish mortgage providers.

Translated by prosa.fo