OECD HOUSEHOLDS’ ASSETS & LIABILITIES – Table 7HAL

1. OECD HOUSEHOLDS’ ASSETS & LIABILITIES – Table 7HAL Progress report on data collection and methodology Working Party on Financial Statistics meeting Paris, 2-4 November 2009 Isabelle YNESTA National Accounts and Financial Statistics OECD Statistics Directorate

2. Objectives of the presentation • Situation of the OECD households’ assets and liabilities database. • Main results of the methodological survey. • Future improvements: proposal for a new classification of households’ liabilities – Loans AF4. • Future developments: additional non-financial assets.

3. Background • 2005: data collection on households’ financial and non-financial assets. • 2008: extension of the OECD households’ assets database by adding liabilities on short-term and long-term loans (AF41 and AF42). • The former questionnaire Table 7HA becomes the Table 7HAL.

4. Situation of the OECD households’ assets & liabilities database (7HAL) • The database contains data for 29 countries. • Missing country is Iceland. • 27 countries report 2008 data. • Most countries provide data back to 1995 as requested, except Ireland, Korea, Luxembourg, Mexico and Switzerland. • 13 countries cover data for the sector S14 (Households) as requested, and 16 for the aggregated sector S14_S15 (Households and non-profit institutions serving households).

5. Asset Coverage • On the financial side: • AF52: 16 countries provide its 6 sub-components; • AF611: 16 countries provide its 2 sub-components; • AF612: among the 24 countries which cover this instrument : • 14 report data on pension plans managed by autonomous pension funds and its sub-components; • 4 report data on pension plans managed by non-autonomous pension funds and its sub-components; • 4 report data on insured pension plans and its sub-components. • AF613 and AF614: Few countries report data for these two assets (3 and 2 respectively). • On the non-financial side: • 11 countries provide total non-financial assets AN; • 14 provide data on dwellings AN1111; • Only 6 countries report both dwellings and land.

6. Liability Coverage – AF4 Loans • 27 countries report data for total loans AF4. • 23 countries provide short-term and long-term loans (AF41 & AF42) breakdown. • On the short-term side, 14 countries report data for both consumer credit AF411 and other short-term loans AF412. • On the long-term side, 13 countries provide both house purchase loans AF421 and other long-term loans AF422.

7. Liability Coverage – AF4 Loans • However a few countries can report the required detail at 4-5 digit level. • On the short-term side: • Consumer credit AF411: among the 16 countries which cover this instrument: • 6 countries report data on total revolving and totalnon-revolving credit (AF4111 & AF4112), of which : • 4 report data on credit cards AF41111 and other lines of credit AF41112; • 4 report data on loans for consumer durablesAF41121; • 4 report data on other instalment AF41122. • On the long-term side: • House purchase loans AF421: among the 18 countries which cover this instrument : • 5 countries report data on both mortgage guaranteed AF4211 and unguaranteed AF4212.

8. Situation of the OECD households’ assets & liabilities database (7HAL) • The most complete questionnaires received in 2009 are from • Hungary, Italy • United States • France • Spain • The entire database is on the OECD data warehouse called “OECD.STAT”. • No paper publication and CD-ROMs are released for the moment.

9. Main results of the methodological survey • A more detailed methodological questionnaire has been sent this year to better know sources, methods, definitions and coverage of assets and liabilities of households. • 26 countries out of 29 filled out the methodological survey. • Only 10 countries can provide data before 1995. • 20 countries compile quarterly data of which 15 agree to provide the OECD Secretariat with it. • Main data sources are Financial and National accounts.

10. Main results of the methodological survey • For the finer breakdowns, information come from Monetary Financial Institutions, Insurance companies, Investment funds. • Households’ assets and liabilities data are comparable with the ones reported in the framework of the Financial Balance Sheet (Tables 710 and 720) for 19 OECD countries. • The assets AF52, AF611 and AF612 are all evaluated at market prices for most OECD countries.

11. Difficulties encountered by OECD countries vis-à-vis the classification of loans AF4 in the table 7HAL • The OECD Secretariat thanks all OECD countries for their report on the type of difficulties they faced to fill out the liability part of the questionnaire, which was a first attempt. • Some countries can not report beyond the SNA93/ESA95 requirements (AF41 & FA42). Short-term side: • Consumer credit are not only short-term loans. • Non-revolving credit are rather considered as long-term loans as their maturity often exceeds one year. • However, for some reporting countries, non-revolving credit can be as well short-term loans with a maturity up to one year.

12. Difficulties encountered by OECD countries vis-à-vis the classification of loans AF4 in the table 7HAL Long-term side: • The breakdown of house purchase loans between mortgage guaranteed and unguaranteed is not obvious. • Under AF422 “Other long-term loans”, consumer credit exceeding one year are included. To limit these difficulties and to enhance the number of series collected, the OECD Secretariat proposes a new classification of loans.

13. Proposal of a new classification of households’ loans – AF4 * Secured on a residential property ** Unsecured or secured against other forms of assets

14. Proposal of a new classification of households’ loans – AF4 • Financial instruments at 5 digit level are optional. • Other short-term loans AF412 can include house purchase loans with a maturity less than one year. • Other long-term loans AF423 can include loans that are neither consumer credit nor mortgage loans. Delegates are invited to comment on this proposal.

15. Future projects • Additional non-financial assets: • AN1112 - Other building and structures (including non-residential buildings); • AN1113 – Machinery and equipment; • AN12 – Inventories. • Removal of financial assets AF613 “Other pension plans” and AF614 “Unfunded pension plans” from the questionnaire 7HAL as few countries report data for these two assets (3 and 2 respectively). Delegates are invited to comment on these projects.

16. Conclusions • The OECD Secretariat thanks the delegates and all financial experts for their co-operation and contributions to the 7HAL database during the past year. • The data collection on financial assets of households has improved compared to last year. However, the number of data series on non-financial assets remained the same. • The new data collection on households’ loans - AF4 is encouraging for a first tentative. • The proposal for a new classification of loans can improve the data coverage. • The methodological notes by OECD countries are more detailed and therefore very useful.

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