BNR: General government financial assets stood at 23.1% of GDP in the second quarter of 2023

Financial assets of the general government sector decreased by 1.2 percentage points in the second quarter of 2023 compared to the same period last year, reaching 23.1%, according to data published by the National Bank of Romania (BNR).     According to the source, the downward trend was mainly driven by a 1.4 percentage point decline in the stock of equity and investment fund shares/units to 8.5 per cent of GDP. General government lending reached 1.9 per cent of GDP (down 0.4 percentage points), largely due to repayments by non-financial corporations on central government loans. For the other categories of financial assets, however, an upward trend was observed. Thus, cash and deposits increased by 25.5% in nominal terms, compared to the second quarter of 2022, but in relative terms, the increase was only 0.7 percentage points, to 6.5% of GDP. Other accounts receivable (taxes, duties, social contributions, trade receivables, amounts owed by economic agents to public authorities and external receivables) increased by 0.1 percentage points, to 5.9% of GDP. "General government financial liabilities as a share of GDP increased by 4.6 percentage points, getting to 51.7% at the end of Q2 2023. This evolution was determined, mainly, by the issuance of government securities by the Ministry of Finance to finance the budget deficit and refinance government debt and are reflected in the financial instrument debt securities, which increased by 4.5 percentage points in the period under review, reaching 35.3% of GDP’says BNR. A similar trend was seen in the stock of other accounts payable which reached the level of 8.8% of GDP, up against Q2 2022 by 0.4 percentage points as a result, mainly, of the registering of the sums due to non-financial companies in the context of the measures taken by the state to reduce the impact resulted from the increase of energy prices. The loans taken registered an increase of 9.6% in nominal terms, against Q2 2022, but in relative terms, they diminished by 0.2 percentage points, to the level of 6.8% of GDP, due to the issuance of non-marketable government securities to the general public under the Tezaur 7 programme launched during the period under review.The sector of public administrations registered in Q2 this year a net financing necessary worth 1% of GDP against 0.5% of GDP as it was in Q2 2022. The central administration presented a net financing necessary of 1% of GDP against 0.5% of GDP during the same quarter of the previous year, and the local administrations registered a net financing capacity in both analysed quarters, namely 0.01% of GDP in Q2 023 and 0.1% of GDP in Q2 2022. Social security funds recorded a net financing requirement of 0.03% of GDP in Q2 2023 compared to 0.1% of GDP in Q2 2022.The quarterly national financial accounts of general government are a component of government finance statistics and a source of data for the preparation of fiscal notification. The main data sources used in the compilation of general government financial accounts are: administrative data, monetary and financial statistics and balance of payments statistics, the NBR points out.