Families suffered a loss of wealth hit by falls in their assets on the stock market
The net financial wealth of households and NPISHs, which is obtained by deducting liabilities from total financial assets, stood at 1.53 trillion euros at the end of the first quarter of 2020, an amount similar to a year earlier, according to data from the Bank of Spain. In quarter-on-quarter terms, the fall in household wealth was 6%.
These data already reflect the impact of the uncertainty caused by the coronavirus pandemic, since the state of alarm was declared as of the last fortnight of March.
In fact, households suffered a fall in the value of their net financial assets as a result of the collapse of the markets.
- Thus, the balance of financial assets of households and NPISHs reached an amount of 2.29 trillion euros at the end of the first quarter of 2020, 1.1% less than a year earlier.
- And is that on the one hand, households invested 43,000 million euros in financial assets last year, but suffered losses of 68,000 million euros, mainly due to the fall in the price of equity assets in the last quarter as a consequence of the Covid-19 crisis.
- In relation to GDP, the total financial assets of households and NPISHs represented 184.7% at the end of the first quarter of 2020, which is 5.9 points less than a year earlier.
By type of assets, families continue to concentrate them in cash and deposits (40% of the total), followed by equity stakes (27%), insurance and pension funds (16%) and mutual fund stakes (13 %).
- Cash and deposits was the component that most increased its weight in household financial assets compared to a year earlier, while the weight of equity participation was the one that fell the most.
On the other hand, the consolidated debt of companies and households and NPISH2 reached 1.61 trillion euros, 129.9% of GDP, but it is 3.7 percentage points less than a year ago, and maintains the tendency of both institutions to gradually reduce their credits.
The consolidated debt of non-financial corporations represented 73.1% of GDP, while for households and NPISHs it was 56.9%.