Netherlands facing long period of weak growth

30th May 2012, Comments 0 comments

The central bank of the Netherlands DNB fears the Dutch economy will show no signs of recovery this year and, from a historical perspective, only limited growth in the next.

In a report published on Wednesday, DNB writes that a prolonged period of weak growth would put substantial pressure on profits, increase credit risks and worsen the stagnation in the housing market.

DNB again points to the risks of the Netherlands’ high mortgage debt. “The Netherlands’ mortgage debt has reached a very high level, both in absolute terms 640 billion euros and in relative terms 105 percent of Gross Domestic Product, and is also very high from an international perspective.”

The Dutch central bank writes that high mortgage debt, inadequate economic growth and falling housing prices are making households, banks and the government increasingly vulnerable.


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