The volume of financial assets of Estonian people was over 10 billion euros in 2016
According to the financial services market overview published by Finantsinspektsioon the market trends in 2016 were similar to those seen in previous year. The growth in the volume of services targeted at savings and investing was supported by mandatory pension funds and the loan portfolio of banks increased.
Commenting on the general situation of the financial market, Kilvar Kessler, the Chairman of the Management Board of Finantsinspektsioon, said that the amount of different investment offerings has increased rapidly. “People are offered ever more new and exciting investment opportunities, but it may be more difficult to understand the risks connected to them. Crowdfunding platforms and credit cooperatives have become more popular, but most of these institutions are not under the supervision of Finantsinspektsioon and the deposits placed in them are not guaranteed through the national Guarantee Fund. We believe that the market participants, consumers, regulator and financial supervision authority should discuss whether these new investment opportunities need to be regulated additionally and put under public supervision”, Kessler commented. “Unfortunately there is also a growth trend in fraudulent “investment offerings”. Whenever possible, Finantsinspektsioon warns the public of its suspicions and requests the competent authorities to initiate criminal proceedings. We also support our skilled colleagues in the investigative institutions in finding and convicting frauds”, said Kessler.
Total balance of deposits increased by 5% in 2016, or by 798 million euros, amounting to 16.3 billion euros at the end of the year. The volume of demand and overnight deposits grew the most – by 7%, or by 855 million euros over the year –, mostly due to low interest rates.
Balance of the banks’ loan portfolio increased by 6% in 2016, or by 1 billion euros. As at the end of the year, the banks’ loan portfolio amounted to 17.8 billion euros. Additionally, Finantsinspektsioon started to supervise creditors in 2016, their loan portfolio makes up 0.7 billion euros.
The growth in the volume of investment services has still been led by pension funds, where volume of assets increased by 18% in 2016. The volume of assets of real estate funds grew noticeably, by 61%. Altogether, the volume of assets placed in financial services targeted at savings and investing grew by 5% last year, to 10.2 billion euros.
The volume of insurance premiums in life insurance increased by 3% in 2016 and amounted to 86 million euros. The volume of insurance premiums in non-life insurance increased by 8% and amounted to 302 million euros.
In 2016, the financial assets of Estonian resident private persons exceeded their liabilities: the volume of financial assets was 10.2 billion euros as at the end of the year, while the balance of financial liabilities was 8.4 billion euros. Consequently, the net financial assets amounted to 1.8 billion euros at the year-end. The average volume of assets of an Estonian resident private person was 7,709 euros and the balance of loans 6,339. The average net financial assets of a private person was thus 1,370 euros.