January 26, 2023
Falling stock market prices and rising interest rates once again caused the value of financial assets to depreciate in the third quarter of 2022.
Households were less active in the third quarter and, overall, in the first nine months of 2022 than in the same periods in 2021.
In the third quarter of 2022, the net financial wealth of Belgian resident individuals decreased by €23.6 billion to €1,119.9 billion as of 30 September 2022. This decline was due to a combination of falling share prices and rising interest rates. Both factors led to depreciation of investment fund holdings (-€5.6 billion). The equity market downturn caused the value of listed shares to drop (-€4.0 billion). Furthermore, as in the first half of the year, the value of insurance products fell in the third quarter (-€10.4 billion) due to the rising yield curve. This curve is an important factor in the valuation of technical provisions for life insurance and pension entitlements.
Rising interest rates also brought about a slump in the value of debt securities (-€0.3 billion).
Investments by individuals in financial assets decreased by €1.0 billion in the third quarter of 2022. Indeed, individuals were less active in the third quarter and, overall, in the first nine months of 2022 than in the corresponding periods of 2021. This declining investment pattern mirrors the decline in the household saving rate.
Sight deposits (-€1.4 billion) and regulated savings deposits (-€1.2 billion) declined. Moreover, individual investors disposed of insurance products in the third quarter (-€1.9 billion), while limited purchases of investment fund shares (+€0.5 billion) were recorded. It is noteworthy that for the first time since the fourth quarter of 2011, net investment in debt securities rose (+€0.3 billion).
New financial liabilities incurred by individuals rose by €3.3 billion in the third quarter to an outstanding amount of €336.7 billion on 30 September 2022, due almost entirely to an increase in mortgage loans (+€3.6 billion).
Source: National Bank of Belgium
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