At the end of the first quarter of 2017, households' financial assets amounted to €5,676 billion; this figure was up markedly, by just over €84 billion (1.5%), from the fourth quarter of 2016. The rise was predominantly attributable to the transaction-based acquisition of financial assets, which, at roughly €60 billion, was higher than in the preceding quarters. The lion’s share of funds, in the amount of over €24 billion, was invested in claims on insurance corporations and pension funds. Flows to currency and deposits, at approximately €12 billion, were considerably lower than in the strong preceding quarter. The preference for liquid and low-risk assets, which has been the prevailing trend for some time now, was still evident overall. However, household investment in shares and investment fund shares expanded again, following a weaker preceding quarter. In the same period, households’ liabilities grew by just over €7 billion, which meant that their net financial assets rose by €77 billion (2.0%) from the preceding quarter to €3,997 billion.

The external financing of non-financial corporations stood at just under €71 billion in the quarter under review and was thus distinctly stronger than the long-term average. The most important source of financing was loans, which were taken up in the amount of €30 billion net. Financing via debt securities also made a positive contribution. Overall, the net financial assets of non-financial corporations increased by €13 billion (0.7%) to -€1,743 billion at the end of the first quarter of 2017.

Households: extensive acquisition of financial assets accompanied by weaker external financing

In the first quarter of 2017, the transaction-related acquisition of financial assets by households in Germany totalled just less than €60 billion on balance and thus continued to be well above the long-term average. €17 billion of this figure was invested in currency and transferable deposits. By contrast, time deposits, savings deposits and savings certificates were scaled back slightly. The lion’s share of the funds (over €24 billion) was channeled into claims on insurance corporations and pensions funds. Against the backdrop of the prevailing low-interest-rate environment, households thus showed a sustained preference for asset forms considered to be particularly liquid or low-risk.

Yet at the same time, investment by households in the capital markets was somewhat stronger than in the preceding quarter. Households predominantly acquired roughly €9 billion in investment fund shares, including primarily real estate funds and mixed securities funds. Furthermore, shares and other equity were purchased to the tune of nearly €2 billion net, following net sales in the preceding quarter. Demand was noteworthy for foreign listed shares, while listed shares issued by domestic corporations saw moderate outflows of funds. This investment behaviour therefore points to a yield awareness of sorts, as foreign assets are usually considered riskier and are therefore acquired in the expectation of higher yields. By contrast, holdings of debt securities were scaled back in the first quarter of 2017, although the outflows of funds were lower than before, at about €1 billion.

The overall favourable capital market setting in the quarter under review brought valuation gains for households in Germany on top of the transaction-related increase in financial assets; taken in isolation, these valuation gains boosted holdings of financial assets by roughly €25 billion. This mainly concerned listed shares and investment fund shares. On balance, the transaction and valuation-based changes led to a considerable first-quarter increase in financial assets of around €84 billion (1.5%), taking the figure to €5,676 billion at the end of the quarter.

In terms of external financing, households raised funds in the amount of around €6 billion, which was somewhat lower than the previous quarter. This slightly weakened the upward trend that has been observed since mid-2013. In the first quarter of 2017, funds were provided almost exclusively by domestic monetary financial institutions, mainly in the form of loans for house purchases. Liabilities rose overall by just over €7 billion (0.4%), to €1,678 billion. In combination with the growth in financial assets, this sent net financial assets €77 billion (2.0%) higher to €3,997 billion. Since growth in nominal GDP outpaced the increase in debt in the reporting quarter, the debt ratio – defined as total liabilities as a percentage of nominal GDP (four-quarter moving sum) – decreased slightly to 53.1% at the end of the quarter and thus remains rather low compared to the euro area as a whole.

Non-financial corporations: robust acquisition of financial assets and external financing

The transaction-related acquisition of financial assets by non-financial corporations was very robust in the first quarter of 2017, at just under €117 billion. Alongside investment in shares and other equity (€17 billion), credit claims, especially on non-residents, also rose in particular (€28 billion). Clear inflows of €76 billion net were likewise recorded in respect of other accounts receivable, which include trade credits and advances. By contrast, non-financial corporations reduced their currency holdings and bank deposits by €0.5 billion on balance. This was primarily attributable to a scaling-back of transferable deposits (including currency) (‑€8 billion), while time deposits increased (€7 billion). On balance, debt securities also saw small outflows (‑€1 billion).

The external financing of non-financial corporations stood at just under €71 billion in the quarter under review and was thus distinctly stronger than the long-term average. The most important source of financing was loans, which were taken up in the amount of €30 billion net. As well as being provided by domestic monetary financial institutions, funds to non-financial corporations were sourced in large part from abroad. Funding via debt securities was also stronger than in the preceding quarter, at €8 billion in total, and should be seen, not least, against the backdrop of the corporate sector purchase programme. Inflows of funds from issuing shares and other equity came to roughly €3 billion on balance and also changed the investor structure. While non-residents increased their holdings of listed shares of non-financial corporations by just over €7 billion, households and domestic corporations reduced their stocks by just under €7 billion. Furthermore, non-financial corporations raised funds worth roughly €29 billion in the form of other liabilities, including primarily trade credits and advances.

Alongside the transaction-related increase in financial assets and liabilities, there were valuation adjustments which boosted financial assets by €75 billion and liabilities by €108 billion. Net financial assets thus rose by a total of €13 billion in the first quarter, reaching -€1,743 billion. The debt ratio – defined as the sum of issued debt securities, loans and pension provisions as a percentage of nominal GDP (four-quarter moving sum) – amounted to 62.1% at the end of the first quarter. Since debt grew more strongly than nominal GDP, the debt ratio increased slightly from the previous quarter by 0.7 percentage point.

Owing to interim data revisions of the financial accounts and national accounts, the figures stated in this press release are not directly comparable with those shown in earlier press releases.