Concepts and definitions

Average repayment term

Average (in days) of maturities agreed at the time of granting of credits granted by small loan companies during a quarter weighted by the number of credits granted during the quarter.

Bill of exchange

A bill of exchange is a payment order issued by the drawer, or a debt instrument signed by the drawee. This category includes the balance of bills receivable granted from own assets or intermediated from central government funds or funds of other financial institutions. So called "negotiable promissory notes" belong to the category "other credit".

Bonds classified as investments

Bonds classified as investments (to be held to maturity), e.g. bonds, debentures and other bond loans, such as corporate loans, convertible bonds and bonds with equity warrant.

MFI (monetary financial institution) holdings of bonds classified as debt securities. Insurance corporation holdings of bonds classified as investments (including insurance corporation reserves for equity-linked policies).

Bonds other than financial assets

Other bonds than bonds classified as investments (i.e. as being held to maturity) in the bond holder's annual accounts.

Business loans

Business loans (loans to enterprises and households of own-account workers) include all lending to sectors S.1111-S.1112 (Public and private non-financial corporations) and S.141 (Households of employers and own-account workers), including housing loans.

Commercial paper

A commercial paper is a zero-interest negotiable bearer instrument issued by a company.

Costs of new credits

Costs arising from credits granted by a small loan company during a quarter. Such costs incurred by clients include one-off handling fee, hire-purchase surcharge, costs arising from postponement of maturity and SMS charges from the raising of the credit. Costs arising from the collection of credits are not included in this item.

Credit card credit

The unpaid capital of actual credit card credits (extended credit card credits) and convenience credits at the end of the quarter.

Debt securities

Debt securities comprise all marketable debt instruments, such as Treasury bills, securities issued by municipalities, bank certificates of deposit, commercial papers, bonds and convertible bonds.

Euro lending

Euro lending = loans and advances in euro + loans granted from central government funds + bonds and debentures in euro classified as investments.

Euro lending

Euro lending = loans and advances in euro + loans granted from central government funds + bonds and debentures in euro classified as investments.

Exchange rate changes

To calculate the exchange rate change, the amount of outstanding credit on the date of reporting is first translated into euros at end-of-term mid-market prices of both the present and the preceding quarter. The difference between these two amounts indicates the (positive or negative) exchange rate change. Exchange rate changes are reported only by main sectors.

Lending

Lending includes overdrafts (on current accounts), bills of exchange, promissory notes and other loans.

Loans granted from government funds

Loans granted from government funds for specific purposes, such as farm loans, loans for the utilisation of land, loans for rural industries, loans for small industries, etc.

Loans to the public

Loans to the public equals total lending minus loans to foreign borrowers and overlapping credits (loans between financial institutions, central government and social security funds as well as loans intermediated from central government funds).

Marketable instruments

Includes e.g. certificates of deposit, commercial papers and local authority papers, Treasury bills and debt instruments issued by asset management companies. Non-transferable certificates of deposit are not included in this category.

New credit

New euro and foreign currency denominated credit, including renewals of loans involving significant changes in loan terms (not including factors such as interest rate linkage, if other factors such as the loan period remain unchanged).

The concept of "new credit" used in the publication "Outstanding credit" includes purchases of bonds classified as investments (Cf. "Purchases").

Number of customers

Number of clients of small loan companies during a quarter. All persons to whom new credit has been granted during the quarter are counted as clients. A client who has raised several credits with the same company during a quarter is only counted once as client. Clients who have not raised new credit during a quarter but have had unpaid loan capital with the company during the quarter are not counted as clients for that quarter.

Other credit

The outstanding balance on factoring credit, hire purchase contracts, rental financing credit, repos, credit card credit and other claims not belonging to any other category of financial assets.

Outstanding credit

The item "outstanding credit" includes outstanding euro denominated credit and outstanding foreign currency denominated credit. Euro denominated credit includes euro denominated loans and advances, loans granted from central government funds, as well as bonds and debentures classified as investments. Foreign currency denominated credit includes foreign currency denominated loans and advances, as well as foreign currency denominated bonds classified as investments.

The item "outstanding loans", both euro and foreign currency denominated, includes overdrafts, bills of exchange, promissory notes and other loans.

The item "bonds classified as investments" includes bonds and debentures that are recorded as investment assets. In the case of credit institutions, the item includes transferable bonds and debentures. In the case of insurance companies, the item includes bonds and debentures classified as investments.

Three different concepts of outstanding credit are used for statistical purposes.

1. Total lending:

This item includes all loans granted by a sector, i.e.:

• loans to the public,
• loans to foreign borrowers,
• loans between financial institutions, central government and social security funds.

Loans granted from central government funds are included twice in total lending:

a) first as central government credit to the banking sector, and a second time as loans from the banking sector to the public,

b) first as central government credit to the municipal sector, and a second time as loans to the public.

2. Loans to the public:

Loans to the public equals total lending minus loans to foreign borrowers and overlapping credit (loans between financial institutions, central government and social security funds as well as loans intermediated from central government funds).

3. Loans to enterprises and entrepreneur households:

This item includes loans to sectors 1 (enterprises) and 51 (households of employers and own-account workers). The item appears as a sum total in tables where loans are classified by the borrower's economic activity.

Loans to sectors 1 and 51 include housing loans granted to these sectors.

Outstanding credit in foreign currency

Outstanding credit in foreign currency = lending in other currencies than euro + bonds classified as investments denominated in other currencies than euro.

Overdrafts on current accounts

End-of-period balance of unused credit limits on deposit account overdraft facilities provided by monetary financial institutions. Unauthorised overdrafts are not included.

Promissory notes

The outstanding balance on promissory notes extended by financial institutions from depository assets (or by insurance corporations from insurance funds) or from equity capital. Loans granted by institutions supervised by the Finnish Centre for Pensions are also included, as are interest subsidy loans, and, in the case of insurance corporations, non-mandatory lending as well as relending to employers and policy-holders.

Purchases

Purchases of bonds classified as investments (including other bonds such as debentures, corporate loans, convertible bonds and bonds with equity warrant).

MFI (monetary financial institution) purchases of bonds classified as debt securities. Insurance corporation purchases of bonds classified as investments (including reserves for equity-linked policies).

Cf. also New credits.

Small loan company

A company whose principal business activity is granting of small or smallish unsecured consumer credits with a typical original maturity, or repayment term, of less than three months. These loans are typically paid back in one or just a couple of instalments. In addition, the loans generally carry no actual nominal rate of interest, but all their costs usually arise from other expenses, such as handling and processing fees, and service and SMS charges. The services of a small loan company can typically be ordered by SMS or via the Internet, whereby the loan is at the client's disposal very quickly.

Total lending

This item includes all loans granted by a sector, i.e.:

• loans to the public,
• loans to foreign borrowers,
• loans between financial institutions, central government and social security funds.

Loans granted from central government funds are included twice in total lending:

a) first as central government credit to the banking sector, and a second time as loans from the banking sector to the public,

b) first as central government credit to the municipal sector, and a second time as loans to the public.