Deposits and cash continue to be the preferred financial asset of Spanish households for another quarter. These two components account for 40% of the €2.6 trillion in financial assets. In fact, its weight in the total increased the most in the second quarter of 2022 compared to a year earlier: 1.7 percentage points, reflecting households’ fear of the crisis. Spaniards’ cash and deposits totaled 1.07 billion euros between April and June, according to data from the Financial Account of the Spanish Economy of the Bank of Spain.

These 1.07 trillion euros in cash and deposits are 2% more than in the first quarter of the year. In fact, this article has been steadily growing year on year since 2017. However, in the year of the pandemic, 2020, when there were quarantines and restrictions on mobility and consumption, money sent to cash and deposits increased by 8.8%. In the accumulated 2021, it managed to exceed one billion euros as it closed the year at 1.03 billion euros.

Earlier this year, members of the Bank of Spain explained that the fear of losing savings makes households prefer to have it in cash. In fact, they noted that having money usually provides more security than having a bank account, which is just a number and doesn’t physically exist.

The total balance of financial assets (cash, shares, deposits and rental securities) of households and NPISHs reached 2.67 trillion euros in the second quarter, up 0.7% from a year earlier, and the figure is equivalent to 210% of GDP. As the Bank of Spain notes, this increase reflects the net acquisition of financial assets, which amounted to 63.6 billion euros last year.concentrated in deposits and, to a lesser extent, in equity investments, which was partly offset by a negative revaluation of €44.9 billion.

Equity, i.e. shares, is the second asset most often chosen by Spanish households, as they account for 29% of the total. In third place is participation in investment funds with 14% of the world and, finally, in insurance and pension funds with 13%. The weight of insurance and pension funds fell the most, 1.6 p.p., the latter is due to its negative revaluation. In total, insurance and pension funds collect 346,459 million euros.

The net wealth of Spanish families and non-profit institutions serving households (NPISH) was €1.89 trillion in the second quarter, representing an increase of 0.3% year on year. The report also reflects a small increase in household debt in absolute terms.although it has declined to 56.5% of GDP from 61.5% in June 2021.

On the other hand, the financial accounts of the Bank of Spain also show the indebtedness of households and companies. in the second trimester the consolidated debt of companies and households reached 1.68 trillion euros, down 0.7% year on year and 4.2% up from the end of 2019, before the start of the pandemic. In terms of GDP, this ratio indicates a decline in debt to 132.2% from 146.1% in June 2021, but up from 129.3% in December 2019.

Household debt rose from 712,000 million in June 2021 to 717,600 million in the same quarter of 2022. However, the ratio to GDP declined to 56.5%, a percentage down from 61.5% in the same quarter of 2021 and similar to 56.8%. end of 2019.