Financial Stability 1/2003
Charts
Chapter 1
Chart 1.1 Number of bankruptcies, employees and
sales of bankrupt companies. Index
350
350
300
300
250
250
Sales value1)
200
200
150
150
100
100
Number of
bankruptcies
50
50
Employees1)
0
1995
1) Turnover
1997
0
1999
2001
2003
and employment in last normal operating year
figures based on Q1 2003
2) Annualised
Source: Statistics Norway
2)
Chart 1.2 Banks' pre-tax operating profit/loss on
ordinary activities as a percentage of ATA1)
2
2
1
1
2)
0
0
-1
1992
-1
1) Average
1994
1996
1998
total assets. Parent bank
2) Annualised
figures for 2003 based on Q1
Source: Norges Bank
2000
2002
Chart 1.3 Non-performing loans and recorded loan
losses in banks. Percentage of gross lending
11
11
9
9
Non-performing loans per
quarter
7
7
5
5
3
3
1
-1
1992
1
Annualised loan losses
-1
1994
1996
Source: Norges Bank
1998
2000
2002
Chart 1.4 Deposit-to-loan ratios in banks1).
Percentage of gross lending
100
100
90
90
80
70
70
Other
60
50
1993
80
3 largest2)
60
4th-8th largest
1995
1997
1999
2001
50
2003
Excluding branches of foreign banks
Den norske Bank (incl. Postbanken throughout the period),
Nordea Bank Norge and Gjensidige NOR Sparebank
1)
2)
Source: Norges Bank
Chart 1.5 Credit as a percentage of GDP
170
170
160
160
Total credit to
mainland Norway2)
150
150
140
140
130
130
120
110
120
Credit from
domestic
sources (C2)2)
Total credit (C3)1)
100
90
1987
1) Percentage
2) Percentage
110
100
90
1990
1993
of GDP
of mainland GDP
Source: Norges Bank
1996
1999
2002
Chart 1.6 Household borrowing rate after tax
deflated by consumer price inflation1). Per cent
9
9
6
6
3
3
0
0
-3
-3
-6
-6
-9
1982
-9
1) With
1986
1990
1994
1998
2002
effect from 2001 Q4, rise in the CPI-ATE is used as deflator
Source: Norges Bank
Charts
Chapter 2
Chart 2.1 International equity price indices.
Indexed, 02.01.02 = 100
120
120
110
Japan, Topix
Norway, OBX
100
US, S&P 500
90
110
100
90
80
80
70
70
60
50
jan 02 apr 02
Source: EcoWin
60
Europe, Stoxx
50
jul 02
okt 02
jan 03 apr 03
Chart 2.2 Relationship between price and future
earnings1) for companies in the S&P 500 index
60
60
45
45
30
30
15
15
0
0
1988 1990 1992 1994 1996 1998 2000 2002
1) Actual
and estimated (from Q4 2002) annual earnings one
year ahead from the price date
Sources: Standard and Poor’s and Norges Bank
Chart 2.3 Effective yield on government bonds with
10 years to maturity
7
7
6
US
6
5
5
Euro countries
4
4
3
jan 00 jul 00 jan 01 jul 01 jan 02 jul 02 jan 03
3
Source: Datastream
Chart 2.4 Components of wealth among US
households. In billions of USD
12000
12000
9000
Equities
9000
6000
6000
3000
0
1995
3000
Bank deposits etc.
0
1997
1999
2001
Source: Board of Governors of the Federal Reserve
Chart 2.5 Default rates for corporate bonds1) and
bank loans2) in the US. Percentage outstanding
5
5
4
4
Bonds
3
3
Bank loans
2
2
1
1
0
1984
0
1) The
1987
1990
1993
1996
1999
2002
figure for 2003 is the average for January-April
loans more than 30 days after due date
2) Non-performing
Sources: Datastream and Federal Deposit Insurance Corp.
Chart 2.6 Bank failures1) in the US. Measured in
terms of total assets (USD bn) and number of banks
40
35
30
4
Total assets (right-hand scale)
3
25
20
15
Number of banks (left-hand scale)
1
10
5
0
1993
1)
2
0
1995
1997
1999
2001
Banks where insolvency proceedings have been initiated
Source: Federal Deposit Insurance Corporation
Chart 2.7 Bank index and total index in Japan.
Indexed, 01.10.02 = 100
100
100
Total index (Topix 500)
90
90
80
80
70
70
Bank index
60
60
50
okt 02
50
des 02
Source: EcoWin
feb 03
apr 03
Chart 2.8 Yield differentials between government
debt of some emerging economies and US
government bonds. Percentage points
25
25
20
20
Brazil
15
15
Venezuela
10
10
Turkey
5
0
jan 02
5
Asia
apr 02
Source: EcoWin
Eastern Europe
jul 02
okt 02
jan 03
apr 03
0
Chart 2.9 Sub-indices on the Oslo Stock Exchange.
Indexed, 02.01.02 = 100
120
120
110
110
100
Energy
Financial
100
90
90
80
80
70
60
70
All share index
(OSEBX)
60
ICT1)
50
40
jan 02 apr 02
1)
Industrials
40
jul 02
okt 02
jan 03 apr 03
Weighted average of telecoms and IT index
Source: EcoWin
50
Charts. Box
P/E ratio for the Norwegian
stock market
Chart 1 Price earnings (P/E) ratio for companies
listed on the Oslo Stock Exchange1)
30
30
25
25
20
20
15
15
10
10
5
5
0
1993
0
1995
1997
1999
2001
1) Total
market value at year-end divided by total
profit/loss on ordinary activities same year
Sources: Dun & Bradstreet, Oslo Stock Exchange and
Norges Bank
Chart 2 Market value at year-end and earnings1) for
companies listed on the Oslo Stock Exchange. In
billions of NOK
50
700
Earnings
(left-hand scale)
40
600
500
30
400
20
300
10
0
1993
1) Annual
Market value
(right-hand scale)
200
100
0
1995
1997
1999
2001
profit/loss on ordinary activities
Sources: Dun & Bradstreet, Oslo Stock Exchange
and Norges Bank
Charts
Chapter 3
Chart 3.1 Business sentiment indicator.
Seasonally adjusted diffusion index1)
15
15
10
10
5
5
0
0
-5
-5
-10
1991
-10
1994
1997
2000
1) A value
2003
below 0 implies that the majority of industrial leaders
expects a weaker outlook in the next quarter.
Sources: Statistics Norway and Norges Bank
Chart 3.2 Consumer confidence indicator1).
Unadjusted figures
45
45
Personal financial
situation
30
30
15
15
0
0
-15
-30
1999
Total
Country's economic
situation
2000
2001
1) Provides
2002
-15
-30
2003
an expression of the share with a positive
assessment of the current situation and outlook for the future less
the share with a negative assessment
Source: Norsk Gallup Institutt AS
Chart 3.3 Rise in house prices and growth in credit
to households. 12-month growth. Per cent
20
20
Credit growth
15
15
10
10
5
5
Rise in house prices
0
-5
1998
0
-5
1999
2000
2001
2002
2003
Sources: Norwegian Association of Real Estate Agents
and Norges Bank
Chart 3.4 Household gross financial assets, housing
wealth and debt. Percentage of disposable income
250
Housing wealth
Gross fin. assets
200
150
100
Debt
Gross fin. assets
excl. insurance claims
250
200
150
100
50
50
1984 1987 1990 1993 1996 1999 2002
Source: Norges Bank
Chart 3.5 Households' total debt as a percentage
of the value of housing wealth
120
120
100
100
80
80
60
60
40
1982
1986
Source: Norges Bank
1990
1994
1998
40
2002
Chart 3.6 Number of dwellings sold. In
thousands
100
100
80
80
60
60
40
40
20
20
0
0
1992
1994
1996
1998
2000
2002
House properties. Unrestricted sales. Including housing
cooperative dwellings
1)
Source: Statistics Norway and NBBL
Chart 3.7 Household debt burden1) and debt as a
percentage of disposable income less expenses for
necessities2)
200
180
Debt/disposable income
less necessities
160
140
200
180
160
Debt burden
120
140
120
100
100
1987 1990 1993 1996 1999 2002 2005
1) Loan
debt as a percentage of disposable income
2) Food, non-alcoholic beverages, clothing and footwear
Source: Norges Bank
Chart 3.8 Household debt burden1) in selected
countries. Annual figures
160
160
140
Japan
140
120
Norway
120
UK
100
Sweden
80
60
1990
1) Loan
100
US
1992
1994
1996
80
1998
2000
60
2002
debt as a percentage of disposable income
Sources: OECD, Sveriges Riksbank and Norges Bank
Chart 3.9 Household interest burden1) and
the borrowing rate
12
12
10
10
Interest burden
8
8
6
6
Borrowing
rate after tax
4
4
2
2
0
1987
0
1990
1993
1996
1999
2002
2005
Interest expenses after tax as a percentage of disposable
income plus interest expenses
1)
Source: Norges Bank
Chart 3.10 Gross financial capital (excl. insurance
claims) as a percentage of household debt in 2000.
By income decile and interest burden1)
200
180
160
140
120
100
80
60
40
20
0
3
1) Interest
200
180
160
140
120
100
80
60
40
20
0
Interest burden less than 20%
Interest burden over 20%
4
5
6
7
8
9
10
expense as a percentage of disposable income
Source: Statistics Norway
Chart 3.11 Total sales of bankrupt enterprises,
total and for selected industries. In billions of
NOK
20
5,5
All industries
(left-hand scale)
15
Manufacturing
4,5
Property management
etc.1)
10
3,5
2,5
Construction
1,5
5
0,5
0
-0,5
1995
1) Property
1997
1999
2001
2003
2)
management, commercial services and rental activities
figures based on Q1 2003
2) Annualised
Source: Statistics Norway
Chart 3.12 Gross fixed investment by industry as a
percentage of real capital in the industry
25
20
Commercial services
Construction
Post and telecoms
25
20
15
15
10
10
5
5
Manufacturing
Fishing and fish-farming
0
1982 1985 1988 1991 1994 1997 2000
Source: Statistics Norway
0
Chart 3.13 Banks' lending to enterprises, by industry.
12-month growth. Per cent
30 Total enterprises
30
24
Manufacturing etc.1)
Retail trade2)
18
24
18
Services, property
management etc.
12
12
6
6
0
0
-6
feb 01
1)
2)
aug 01
feb 02
aug 02
Manufacturing, mining, utilities and construction
Retail trade, hotels and restaurants
Source: Norges Bank
-6
feb 03
Chart 3.14 Probability of default for large unlisted
enterprises1). Per cent
14
12
14
Median of
20% weakest
12
10
10
8
8
6
4
2
0
1998
Median of
50 % weakest
6
4
2
Median enterprise
1999
2000
0
2001
2002
2003
Non-financial, unlisted enterprises with a turnover of more
than NOK 70 million. Probability of default within one year
1)
Source: Moody's KMV
Chart 3.15 Probability of default for large unlisted
enterprises. Median observation. Per cent
4
3
4
Norway
Sweden
3
Denmark
2
2
Finland
1
0
1998
1
0
1999
2000
Source: Moody's KMV
2001
2002
2003
Chart 3.16 Banks' loans to property management.
Per cent
40
35
20
Annual change (left-hand scale)
30
25
Property management as a
share of total bank loans
(right-hand scale)
20
15
10
15
10
5
5
0
1988 1990 1992
Source: Norges Bank
0
1994 1996 1998 2000
Chart 3.17 Rental price for and value of office
premises in central Oslo. Price per square metre
3000
2500
20000
Average value
(right-hand scale)
15000
2000
1500
1000
Rental price
prestigious pemises
(left-hand scale)
500
Rental price normal standard
(left-hand scale)
10000
5000
0
0
1986 1988 1990 1992 1994 1996 1998 2000 2002
Source: OPAK
Chart 3.18 Vacant office premises in Oslo, Asker
and Bærum. In thousands of square metres. As of
February
900
800
700
600
500
400
300
200
100
0
1991
1993
1995
Source: Eiendomsspar
1997
1999
2001
2003
Chart 3.19 Debt burden of non-financial enterprises
excl. petroleum and shipping. Per cent of cash
surplus1) excl. interest expenses
800
800
Debt burden based
on net capital
income
600
400
200
Debt burden based
on gross capital
income
0
1987
1990
1993
600
400
Debt burden
previous report 2)
1996
1999
200
2002
0
2005
Cash surplus = Value added - labour costs + gross or net
capital income
2) An audit of the figures has led to an increase in corporate
sector capital income since the November 2002 Financial
Stability report
1)
Sources: Statistics Norway and Norges Bank
Chart 3.20 Interest burden of non-financial
enterprises excl. petroleum and shipping. Per cent
of cash surplus
80
80
Interest burden
based on net
capital income
60
40
60
Interest burden
based on gross
capital income
20
0
1987
40
Interest burden previous
report 1)
1990
1993
1996
1999
2002
1) An
20
0
2005
audit of the figures has led to an increase in corporate
sector capital income since the November 2002 Financial
Stability report
Sources: Statistics Norway and Norges Bank
Charts
Chapter 3, Box 1
P/E ratios for dwellings
Chart 1 House prices deflated by the building cost
index and the annual wage index. Index, 1987=100
150
150
125
Deflated by the building cost index
125
100
100
75
75
50
Deflated by the annual wage
index
25
0
1987
50
25
1990
1993
Source: Norges Bank
1996
1999
0
2002
Chart 2 The P/E ratio for the housing market and
households' real borrowing rate
20
20
P/E
15
10
5
10
Average
0
-5
15
5
0
Real borrowing rate
-10
1979 1982 1985 1988 1991 1994 1997 2000
Sources: Statistics Norway and Norges Bank
-5
-10
Charts
Chapter 4
Chart 4.1 Banks1) financing in bond and money
markets and deposits and loans from financial
institutions. Percentage of gross lending
25
20
25
Bond financing
Deposits and loans
from financial
institutions
20
15
15
10
Money market financing
5
0
1993
1)
10
5
1995
1997
1999
Excluding branches of foreign banks
Source: Norges Bank
2001
0
2003
Chart 4.2 Residual maturity on banks1) financing in
money and capital markets2). March 2003.
Percentage of gross lending
50
50
3 largest
40
4th-8th largest
Other
40
30
30
20
20
10
10
0
0
< 1 mo.
< 3 mo.
< 12 mo. All maturities
Excluding branches of foreign banks
Deposits and loans from credit institutions, bonds, notes and
short-term paper
1)
2)
Source: Norges Bank
Chart 4.3 Banks1) short-term foreign debt2).
Percentage of gross lending
30
30
3 largest
20
20
All banks
4th-8th largest
10
10
Other
0
1993
1995
1997
1999
2001
0
2003
Excluding branches of foreign banks
Deposits and loans from other financial institutions and notes
and short-term paper
1)
2)
Source: Norges Bank
Chart 4.4 Three largest banks: liquid assets (line)
and short-term domestic and foreign debt1) (coloured
areas). Percentage of total assets
25
25
Liquid assets
20
20
15
Short-term foreign debt
10
10
5
0
1993
15
Short-term domestic debt
1995
1997
1999
2001
5
0
2003
Deposits and loans from other financial institutions and notes and
short-term paper
1)
Source: Norges Bank
Chart 4.5 4th to 8th largest banks: liquid assets (line)
and short-term domestic and foreign debt1) (coloured
areas). Percentage of total assets
25
25
20
20
Liquid assets
15
Short-term foreign debt
10
10
5
0
1993
15
5
Short-term domestic debt
1995
1997
1999
2001
0
2003
Deposits and loans from other financial institutions and notes
and short-term paper
1)
Source: Norges Bank
Chart 4.6 Other banks1): liquid assets (line) and
short-term domestic and foreign debt2) (coloured
areas). Percentage of total assets
25
25
20
15
20
Short-term foreign debt
Liquid assets
15
10
10
5
0
1993
5
Short-term domestic debt
1995
1997
1999
2001
0
2003
Excluding branches of foreign banks
Deposits and loans from other financial institutions and notes
and short-term paper
1)
2)
Source: Norges Bank
Chart 4.7 Banks’1) stable funding2) as a percentage
of illiquid assets3)
120
120
110
110
3 largest
100
100
Other
90
90
4th-8th largest
80
1993
1995
1997
1999
Excluding branches of foreign banks
2) Customer deposits, equity and bonds
3) Loans and fixed assets
1)
Source: Norges Bank
2001
80
2003
Chart 4.8 Number of banks by value of liquidity
indicator
70
60
50
Sept. 2002
70
Dec. 2002
60
March 2003
50
40
40
30
30
20
20
10
10
0
0
< 70
70-80 80-90 90-100 100-110 >110
Source: Norges Bank
Charts
Chapter 5
Chart 5.1 Operational abnormalities in the payment
system for ordinary payments. Number of errors and
total errors weighted according to significance
(consequence index). Bi-annual figures
400
400
350
Number of errors
350
300
Consequence index
300
250
250
200
200
150
150
100
100
50
50
0
0
2000
1) Figures
2001
2002
1)
2003
for the first quarter multiplied by 2
Source: The Banks' Payment and Central Clearing House
Chart 5.2 Operational abnormalities in the payment
system for large-value payments. Number of errors
and total errors weighted according to significance
(consequence index). Bi-annual figures
140
140
Number of errors
120
120
Consequence index
100
100
80
80
60
60
40
40
20
20
0
0
2000
1)
2001
2002
1)
2003
Figures for the first quarter multiplied by 2
Source: The Banks’ Payment and Central Clearing House
Charts
Chapter 6
Chart 6.1 Number of banks distributed by pre-tax
profit. Percentage of average total assets
70
70
Q1 2001
Q1 2002
Q1 2003
60
50
60
50
40
40
30
30
20
20
10
10
0
0
< 0.0 0.0- 0.5- 1.0- 1.5- 2.0- 2.5- 3.0- > 3.5
0.5 1.0 1.5 2.0 2.5 3.0 3.5
Source: Norges Bank
Chart 6.2 Loss on loans as a percentage of gross
lending1) distributed by bank groups
1
0,8
Other
4th - 8th largest
1
0,8
0,6
0,6
0,4
0,4
0,2
0,2
0
0
-0,2
3 largest
-0,2
-0,4
-0,4
1997 1998 1999 2000 2001 2002 2003
1)
Cumulative quarterly figures. Annualised
Source: Norges Bank
Chart 6.3 Pre-tax profit as a percentage of average
total assets1) distributed by bank groups
2,5
2,5
4th - 8th largest
2
2
3 largest
1,5
1
1,5
1
Other
0,5
0
1997
1)
0,5
0
1998
1993
2000
Cumulative quarterly figures. Annualised
Source: Norges Bank
2001
2002
Chart 6.4 Number of banks distributed by core capital
ratio
60
50
40
60
2000
2001
2002
50
40
30
30
20
20
10
10
0
0
<4
4-7
Source: Norges Bank
7-10
10-15 15-20
> 20
Chart 6.5 Gross non-performing loans by sector.
All banks. In billions of NOK
3,5
3
3,5
Other sectors
3
2,5
2,5
2
2
1,5
1,5
1
0,5
0
1997
1
Corporate sector
0,5
Household sector
1998
1999
Source: Norges Bank
2000
2001
2002
0
2003
Chart 6.6 Percentage distribution of corporate loans.
All banks
Other
Property management
Services
Manufacturing and mining
Retail trade
2002
Primary industry (ex. fish farming)
2001
Construction
Hotel and restaurant
1997
Fish farming
0 5 10 15 20 25 30
Source: Norges Bank
Chart 6.7 Recorded losses (excl. change in
unspecified losses) as a percentage of loans to
different industry sectors. All banks
Other
Property management
Services
Manufacturing and mining
Retail trade
2002
Primary industry (ex. fish farming)
2001
Construction
1997
Hotel and restaurant
Value=8.0
Fish farming
-0,5
Source: Norges Bank
0,5
1,5
2,5
Chart 6.8 The 8 largest bank groups’ ability
to withstand losses with a break-even result before
losses and with the same profit/loss as in 2002
respectively. Losses over 3 years
Loss as % of gross lending which
depletes buffer capital
3
Same profit/loss as in 2002
2,5
Break-even result before losses
2
1,5
1
0,5
0
1
2
3
4
5
6
7
8
Banks
Source: Norges Bank and banks' financial statements for
2002
Chart 6.9 Developments in financial institutions’
losses on lending to households and non-financial
enterprises. Baseline scenario and stress test
scenario1). Percentage of gross lending
6
6
5
5
4
3
2
Stress test
scenario
4
Baseline scenario
2
3
1
1
0
1988
0
1991
1994
1997
2000
2003
Based on the assumptions in the baseline scenario from Inflation
Report 1/03. The loan loss equations for households and non-financial
enterprises are described in an article in Economic Bulletin 2/03.
1)
Source: Norges Bank
Charts
Chapter 6, Box 1
Chart 1 Probability of bankruptcy in banks'
portfolio of loans to limited companies, distributed
by different bank groups. Per cent
3,5
3,5
3,0
3,0
Small banks
2,5
2,0
1,5
2,5
2,0
8 largest banks
1,5
1,0
1,0
0,5
0,0
1988
Medium-sized banks
0,5
0,0
1991
Source: Norges Bank
1994
1997
2000
Charts
Chapter 6, Box 2
Chart 1 Gross debt in municipalities, non-financial
institutions and households and commercial banks'
lending as a percentage of nominal GDP. 1890-2002
180
160
140
120
100
80
60
40
20
0
Gross debt in municipalities,
non-financial institutions
and households
3)
1)
2)
2000
1990
1980
1970
1960
1950
1940
1930
1920
1910
1900
1890
Commercial banks'
lending
180
160
140
120
100
80
60
40
20
0
The increase in 1960 is partly due to a downward revision of GDP in
connection with the transition to a new national accounting standard.
1)
The marked fall in 1970 is due to an upward revision of GDP in
connection with the transition to a new national accounting standard.
2)
3)
Mainland C3 as a percentage of mainland GDP is used as from 1995.
Sources: Statistics Norway and Norges Bank