5232.0 - Australian National Accounts: Financial = Accounts, Sep 2008

SECTORAL ANALYSIS =

NON-FINANCIAL=20 CORPORATIONS

Summary

Private = non-financial=20 corporations raised a net $45.8b (excluding derivatives and = accounts=20 payable) during the September quarter 2008. They borrowed $27.2b = in loans=20 and issued $18.7b in shares. Net issuance of debt securities = during the=20 quarter was $0.1b. These transactions resulted in total borrowings = outstanding of $865.8b and total equity on issue of $1,051.3b.=20

PRIVATE=20 NON-FINANCIAL CORPORATIONS, NET ISSUE OF EQUITY AND = BORROWINGS

During the September quarter 2008, total = liabilities of national public non-financial corporations = decreased by=20 $0.8b. Liabilities of state and local public non-financial = corporations=20 decreased by $0.5b to $137.9b.

Private non-financial = corporations debt to equity ratio

From the end of = September=20 2006 to the end of September 2008, the value of equity on issue = increased=20 by $83.7b whereas the value of debt outstanding rose by $328.4b. = During=20 the current quarter, private non-financial corporation debt = increased by=20 $66.6b, while equities on issue decreased by $167.9b. Over the = September=20 quarter 2008, the original debt to equity ratio increased from = 0.82 to=20 1.02 and the adjusted ratio increased from 1.59 to 1.60. The = adjusted=20 ratio reflects the removal of price change from the original = series.=20

DEBT TO = EQUITY RATIO -=20 JUNE 1995 BASE
3D"Graph:

FINANCIAL=20 CORPORATIONS

Summary

During the September = quarter=20 2008, financial corporations had $41.8b liability transactions on = a=20 consolidated basis. The liability transactions were: banks, = $75.3b;=20 central bank, $9.5b; central borrowing authorities, $7.6b; life = insurance=20 corporations, $4.3b; other insurance corporations, $2.1b; other = depository=20 corporations, $1.1b; and financial intermediaries n.e.c.,=20 $-34.4b.

Banks

Transactions of financial = assets=20 of banks were net $56.6b during the quarter. Banks lent a net = $32.2b, of=20 which loans to households were $20.0b, rest of world were $10.6b = and=20 private non-financial corporations were $5.0b. Other major = transactions in=20 bank assets holdings were: deposits, net $19.3b, of which $6.8b = were=20 accepted by the central bank and $7.8b by rest of world; equities, = net=20 $4.3b; and bills of exchange, net $2.4b. These were offset by net=20 maturities of bonds of $2.5b.

During the quarter, liability = transactions of banks were net $75.3b. There were currency and = deposits=20 acceptances of $49.4b, loans of $24.3b, one name paper issuance of = $7.5b,=20 and equities issuance of $7.3b. These were offset by bonds = redemption of=20 $6.6b, net settlement of derivatives of $4.6b and net repayment of = other=20 accounts payable of $2.2b.

Other depository=20 corporations

Transactions of other depository = corporations=20 liabilities were net $1.1b during the September quarter 2008, = driven=20 mainly by new deposits of $4.5b. These were offset by settlement = of=20 derivative contracts, $1.3b, repayments of loans of $1.0b and net=20 redemptions of one name paper of $0.8b. Transactions of assets = during the=20 quarter were net $9.5b. The main contributors were deposits of = $4.9b,=20 issuance of loans, $3.7b and purchases of bonds, = $1.2b.

Life=20 insurance corporations

At the end of September quarter = 2008,=20 the financial assets of life insurance corporations were $234.6b, = a=20 decrease of $3.6b from the previous quarter. Net transactions were = $3.9b=20 and valuation decreases were $7.5b. During the quarter, there were = decreases in value of equities outstanding by $7.8b. This was = offset by=20 increases in the amounts outstanding of one name paper, $1.0b, and = currency and deposits, $0.8b. Pension fund claims against the = reserves of=20 life offices decreased by $6.4b following net transactions of = -$0.3b and=20 valuation decreases of $6.1b. Households' claims against the = reserves of=20 life offices increased by $0.9b following net transactions of = $3.2b and=20 valuation decreases of $2.3b.

PENSION = FUNDS

Net=20 equity in reserves of pension funds was $1,028.5b at the end of = the=20 September quarter 2008, a decrease of $47.4b. This follows net=20 transactions of $9.5b and valuation decreases of $56.9b during the = quarter. Asset holdings decreased by $50.3b to $972.4b following = net=20 transactions of $5.9b and valuation decreases of=20 $56.2b.

Other insurance corporations

Net=20 transactions in financial assets of other insurance corporations = were=20 -$0.2b during the September quarter 2008. The main contributor was = the net=20 maturities of bonds of $2.1b. This was offset by net purchases of=20 equities, $0.6b, and increase in holdings of currency and deposits = of=20 $0.3b. During the September quarter, net liability transactions of = other=20 insurance corporations were $2.1b, driven mainly by prepayments of = premiums and changes in reserves of $2.6b.

Central = borrowing=20 authorities

Total liabilities of central borrowing = authorities=20 was $159.6b at the end of the September quarter 2008. During the = quarter,=20 the authorities issued bonds of $2.7b, one name paper of $5.1b, = and=20 borrowed $0.3b through loans. Net asset transactions during the = quarter=20 were $9.6b, the main contributors being issuance of loans, $10.6b, = purchases of one name paper of $0.9b and bills of exchange of = $0.7b. These=20 were offset by the withdrawal of deposits of=20 $1.9b.

Financial intermediaries n.e.c.

At = the end=20 of the September quarter 2008, net liabilities of financial = intermediaries=20 n.e.c. were $424.8b, with shares and bonds on issue of $168.5b and = $148.4b=20 respectively, and loan borrowings of $63.3b. Net liability = transactions=20 were -$34.4b during the quarter, driven by net maturities of = bonds,=20 $14.7b; one name paper, $2.7b; repayments of loans, $10.8b; and = equity=20 redemptions, $0.5b. During the quarter, transactions in financial = assets=20 were -$9.2b. Major contributors were net maturities of loans = assets of=20 $8.1b and redemptions of bonds of $2.0b. These were offset by = purchases of=20 equities of $2.3b and one name paper of $0.9b.

Net = flow of=20 currency and deposits to banks

Transactions in currency = and=20 deposit liabilities of banks during the September quarter 2008 = were net=20 $49.4b. There were transactions in currency and deposit assets of=20 households, $19.3b; rest of world, $12.3b; private non-financial=20 corporations, $10.3b; other depository corporations, $4.9b; and = pension=20 funds, $3.7b. These were offset by withdrawals of bank deposits by = central=20 borrowing authorities, $1.9b; financial intermediaries n.e.c., = $1.3b; and=20 other insurance corporations, $0.6b.=20

CURRENCY = AND=20 DEPOSITS LIABILITIES, BANKS
3D"Graph:

Financial asset portfolio of life = insurance=20 corporations and pension funds at end of quarter

At the = end of=20 the September quarter 2008, life insurance corporations held = $150.4b in=20 shares and other equity (64.1% of their financial assets), of = which=20 $122.9b was in resident companies and $27.5b was in non-resident=20 companies; $44.3b in bonds (18.9% of their financial assets), of = which=20 $34.2b was in bonds issued by domestic institutions and $10.1b in = bonds=20 issued by non-residents; and $15.4b in short term securities (6.6% = of=20 their financial assets).

At the end of the September = quarter 2008,=20 pension funds held $507.3b in shares and other equity (52.2% of = their=20 financial assets), of which $328.6b was in resident companies and = $178.7b=20 was in non-resident companies. They held $159.3b of the net equity = in life=20 office reserves (16.4% of their financial assets); and $94.0b in = bonds=20 (9.7% of their financial assets), of which $49.9b were bonds = issued by=20 domestic institutions and $44.1b were bonds issued by = non-residents.=20

Financial claims between households, = life=20 insurance companies, pension funds and investment managers at end = of=20 quarter

At the end of the September quarter 2008, = households=20 had claims against the reserves of life insurance corporations of = $58.9b=20 and pension funds of $1,028.5b. Pension funds had claims against = the=20 reserves of life insurance corporations of $159.3b. Life insurance = corporations invested $142.7b of their financial assets through = investment=20 managers, and pension funds invested $455.5b through investment = managers.=20

Financial asset portfolio of other = insurance=20 corporations at end of quarter

The graph below shows = that at=20 the end of the September quarter 2008, other insurance = corporations held=20 $39.0b in shares and other equity (29.4% of total financial = assets), of=20 which $29.5b was in resident corporations; $39.6b in bonds (29.9% = of total=20 financial assets), of which $35.7b was issued by resident = corporations;=20 and $11.1b of short-term securities (8.4% of total financial = assets).=20

Central borrowing authorities net = issue of debt=20 securities

During the September quarter 2008, central = borrowing=20 authorities issued bonds of $2.8b and one name paper of $5.1b.=20

Financial intermediaries n.e.c. net = issue of=20 debt securities

During the September quarter 2008, = financial=20 intermediaries n.e.c. had net redemptions of bonds of $14.7b and = one name=20 paper of $2.6b.=20

GENERAL=20 GOVERNMENT

Summary

During the September = quarter=20 2008, consolidated general government transactions resulted in a = net=20 change in financial position of $3.8b.

The net change in = financial=20 position for national general government was $6.0b. The liability=20 transactions of national general government during the quarter = were=20 -$9.0b, with the main contributors being other accounts payable of = -$5.6b=20 and bonds issued domestically of -$3.0b. During the quarter asset=20 transactions for national general government were -$3.0b, with the = main=20 contributor being deposits of -$13.0b. At the end of the quarter, = national=20 general government had total liabilities of $196.8b and total = financial=20 assets of $200.2b.

Transactions in state and local general=20 government financial assets were $0.2b in the September quarter = 2008,=20 while transactions in total liabilities were $2.4b, resulting in a = change=20 in financial position of -$2.2b. At the end of the quarter, state = and=20 local general government had total liabilities of $123.3b and = total=20 financial assets of $121.8b.

Change in financial=20 position

National government issue of debt=20 securities

The graph below illustrates that national = general=20 governments had net maturities of $3.0b during the quarter.=20

HOUSEHOLDS

Summary

= Households=20 change in financial position was $10.5b during the September = quarter 2008.=20 During the quarter, households borrowed a total of $11.5b in the = form of=20 loans. On the asset side, householders' transactions in currency = and=20 deposits were $20.3b, of which $19.3 were bank deposits. Net = contributions=20 to life insurance and pension fund reserves were $12.7b while net = claims=20 on unfunded superannuation were $1.1b.

Households sold a = net $4.1b=20 in equities during the September quarter 2008, the major = contributors=20 being the sale of private non-financial corporations shares, $3.2 = and=20 financial intermediaries n.e.c $1.1b.

At the close of the = quarter,=20 households' stock of financial assets was $2,217.3b. This was a = decrease=20 of $51.9b from the previous quarter, following net transactions of = $27.9b=20 and valuation decreases of $79.8b. Major asset holdings were net = equity in=20 reserves of life insurance corporations and pension funds of = $1,087.4b,=20 currency and deposits of $548.0b, equities of $303.4b and unfunded = superannuation claims of $175.3b.

Household net = borrowing=20 and debt to liquid asset ratio

Of the net $11.5b loans = borrowed=20 by households during the September quarter 2008, bank loans = accounted for=20 $20.0b. This was offset by repayments to financial intermediaries = n.e.c.,=20 $8.6b. Of the bank loans, $15.6b was borrowed for owner occupied=20 housing.

The graph below illustrates that the debt to = liquid assets=20 ratio at the end of September 2008 was at 146.9%, an increase of 3 = percentage points on the previous quarter. The ratio was = influenced by an=20 increase of 1.3% in total outstanding household borrowings and a = decrease=20 in total liquid assets of 0.8%. The major contributor to the = decline in=20 liquid assets was equities (down 10.4%). This was offset primarily = by=20 increases in currency and deposits of 5.4%.=20

Insurance and pension = claims

During=20 the September quarter 2008, households' net equity in reserves of = pension=20 funds decreased by $47.4b, made up of $9.5b in transactions and = $56.9b in=20 valuation decreases, bringing household net equity in pension = funds to=20 $1,028.5b. Net equity in reserves of life insurance corporations = increased=20 $0.9b, made up of $3.2b transactions and $2.3b valuation = decreases,=20 bringing the household net equity in life insurance to $58.9b. Net = transactions in households' unfunded superannuation claims were = $1.1b and=20 prepayments of premiums and claims against reserves in other = insurance=20 corporations were $1.4b during the quarter.

REST OF = THE=20 WORLD

Summary

Non-residents had net = transactions=20 of $35.4b in Australian financial assets during the September = quarter=20 2008, resulting in $1,778.1b of Australian financial assets being = held by=20 non-residents, up $38.6b from the June quarter 2008. Valuation = increases=20 were $3.2b. The main contributors were issuance of loans and = placements=20 $37.3b (of which $24.3b was issued to banks, and $17.9b to private = non-financial corporations) and net purchases of equities, $14.5b, = of=20 which $11.1b was in equities issued by private non-financial = corporations.=20 These were offset by net sales of bonds, $17.9, of which $10.1b = were in=20 bonds issued by the banks.

Australian residents had net=20 transactions of $24.7b in foreign financial assets during the = September=20 quarter 2008. The total value of foreign assets held by Australian = residents increased to $1,068.5b at the end of the quarter. Of = this, $1.8b=20 were valuation decreases. The main contributors to the increase = were net=20 purchases of equity, $11.3b, and the issuance of loans and = placements,=20 $9.6b. These were offset by the net redemption of rest of the = world bonds=20 issued in Australia of $3.8b.

Net purchases of=20 equities

During the September quarter 2008, = non-residents=20 acquired a net $14.5b in equities, an increase of $1.3b compared = with the=20 June quarter 2008.=20

Net purchases of = bonds

Non-residents=20 sold $17.9b of Australian bonds during the September quarter 2008, = a=20 decrease of $25.8b compared with the June quarter 2008 estimate.=20

HAVE YOUR = SAY

5232.0 -=20 Australian National Accounts: Financial Accounts will be reviewed = next=20 year as part of ABS implementation of new international = statistical=20 standards. We would value your input and assistance in helping to = shape=20 this publication to meet your needs. A short feedback form is = linked below=20 for your comments.

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Main=20 Features=20 ANALYSIS=20 AND COMMENTS,Sectoral Summary=20 ANALYSIS=20 AND COMMENTS,Market Summary=20 SECTORAL ANALYSIS=20 About=20 this Release=20 Have=20 your Say	SECTORAL ANALYSIS = NON-FINANCIAL=20 CORPORATIONS Summary Private = non-financial=20 corporations raised a net $45.8b (excluding derivatives and = accounts=20 payable) during the September quarter 2008. They borrowed $27.2b = in loans=20 and issued $18.7b in shares. Net issuance of debt securities = during the=20 quarter was $0.1b. These transactions resulted in total borrowings = outstanding of $865.8b and total equity on issue of $1,051.3b.=20 PRIVATE=20 NON-FINANCIAL CORPORATIONS, NET ISSUE OF EQUITY AND = BORROWINGS During the September quarter 2008, total = liabilities of national public non-financial corporations = decreased by=20 $0.8b. Liabilities of state and local public non-financial = corporations=20 decreased by $0.5b to $137.9b. Private non-financial = corporations debt to equity ratio From the end of = September=20 2006 to the end of September 2008, the value of equity on issue = increased=20 by $83.7b whereas the value of debt outstanding rose by $328.4b. = During=20 the current quarter, private non-financial corporation debt = increased by=20 $66.6b, while equities on issue decreased by $167.9b. Over the = September=20 quarter 2008, the original debt to equity ratio increased from = 0.82 to=20 1.02 and the adjusted ratio increased from 1.59 to 1.60. The = adjusted=20 ratio reflects the removal of price change from the original = series.=20 DEBT TO = EQUITY RATIO -=20 JUNE 1995 BASE FINANCIAL=20 CORPORATIONS Summary During the September = quarter=20 2008, financial corporations had $41.8b liability transactions on = a=20 consolidated basis. The liability transactions were: banks, = $75.3b;=20 central bank, $9.5b; central borrowing authorities, $7.6b; life = insurance=20 corporations, $4.3b; other insurance corporations, $2.1b; other = depository=20 corporations, $1.1b; and financial intermediaries n.e.c.,=20 $-34.4b. Banks Transactions of financial = assets=20 of banks were net $56.6b during the quarter. Banks lent a net = $32.2b, of=20 which loans to households were $20.0b, rest of world were $10.6b = and=20 private non-financial corporations were $5.0b. Other major = transactions in=20 bank assets holdings were: deposits, net $19.3b, of which $6.8b = were=20 accepted by the central bank and $7.8b by rest of world; equities, = net=20 $4.3b; and bills of exchange, net $2.4b. These were offset by net=20 maturities of bonds of $2.5b. During the quarter, liability = transactions of banks were net $75.3b. There were currency and = deposits=20 acceptances of $49.4b, loans of $24.3b, one name paper issuance of = $7.5b,=20 and equities issuance of $7.3b. These were offset by bonds = redemption of=20 $6.6b, net settlement of derivatives of $4.6b and net repayment of = other=20 accounts payable of $2.2b. Other depository=20 corporations Transactions of other depository = corporations=20 liabilities were net $1.1b during the September quarter 2008, = driven=20 mainly by new deposits of $4.5b. These were offset by settlement = of=20 derivative contracts, $1.3b, repayments of loans of $1.0b and net=20 redemptions of one name paper of $0.8b. Transactions of assets = during the=20 quarter were net $9.5b. The main contributors were deposits of = $4.9b,=20 issuance of loans, $3.7b and purchases of bonds, = $1.2b. Life=20 insurance corporations At the end of September quarter = 2008,=20 the financial assets of life insurance corporations were $234.6b, = a=20 decrease of $3.6b from the previous quarter. Net transactions were = $3.9b=20 and valuation decreases were $7.5b. During the quarter, there were = decreases in value of equities outstanding by $7.8b. This was = offset by=20 increases in the amounts outstanding of one name paper, $1.0b, and = currency and deposits, $0.8b. Pension fund claims against the = reserves of=20 life offices decreased by $6.4b following net transactions of = -$0.3b and=20 valuation decreases of $6.1b. Households' claims against the = reserves of=20 life offices increased by $0.9b following net transactions of = $3.2b and=20 valuation decreases of $2.3b. PENSION = FUNDS Net=20 equity in reserves of pension funds was $1,028.5b at the end of = the=20 September quarter 2008, a decrease of $47.4b. This follows net=20 transactions of $9.5b and valuation decreases of $56.9b during the = quarter. Asset holdings decreased by $50.3b to $972.4b following = net=20 transactions of $5.9b and valuation decreases of=20 $56.2b. Other insurance corporations Net=20 transactions in financial assets of other insurance corporations = were=20 -$0.2b during the September quarter 2008. The main contributor was = the net=20 maturities of bonds of $2.1b. This was offset by net purchases of=20 equities, $0.6b, and increase in holdings of currency and deposits = of=20 $0.3b. During the September quarter, net liability transactions of = other=20 insurance corporations were $2.1b, driven mainly by prepayments of = premiums and changes in reserves of $2.6b. Central = borrowing=20 authorities Total liabilities of central borrowing = authorities=20 was $159.6b at the end of the September quarter 2008. During the = quarter,=20 the authorities issued bonds of $2.7b, one name paper of $5.1b, = and=20 borrowed $0.3b through loans. Net asset transactions during the = quarter=20 were $9.6b, the main contributors being issuance of loans, $10.6b, = purchases of one name paper of $0.9b and bills of exchange of = $0.7b. These=20 were offset by the withdrawal of deposits of=20 $1.9b. Financial intermediaries n.e.c. At = the end=20 of the September quarter 2008, net liabilities of financial = intermediaries=20 n.e.c. were $424.8b, with shares and bonds on issue of $168.5b and = $148.4b=20 respectively, and loan borrowings of $63.3b. Net liability = transactions=20 were -$34.4b during the quarter, driven by net maturities of = bonds,=20 $14.7b; one name paper, $2.7b; repayments of loans, $10.8b; and = equity=20 redemptions, $0.5b. During the quarter, transactions in financial = assets=20 were -$9.2b. Major contributors were net maturities of loans = assets of=20 $8.1b and redemptions of bonds of $2.0b. These were offset by = purchases of=20 equities of $2.3b and one name paper of $0.9b. Net = flow of=20 currency and deposits to banks Transactions in currency = and=20 deposit liabilities of banks during the September quarter 2008 = were net=20 $49.4b. There were transactions in currency and deposit assets of=20 households, $19.3b; rest of world, $12.3b; private non-financial=20 corporations, $10.3b; other depository corporations, $4.9b; and = pension=20 funds, $3.7b. These were offset by withdrawals of bank deposits by = central=20 borrowing authorities, $1.9b; financial intermediaries n.e.c., = $1.3b; and=20 other insurance corporations, $0.6b.=20 CURRENCY = AND=20 DEPOSITS LIABILITIES, BANKS Financial asset portfolio of life = insurance=20 corporations and pension funds at end of quarter At the = end of=20 the September quarter 2008, life insurance corporations held = $150.4b in=20 shares and other equity (64.1% of their financial assets), of = which=20 $122.9b was in resident companies and $27.5b was in non-resident=20 companies; $44.3b in bonds (18.9% of their financial assets), of = which=20 $34.2b was in bonds issued by domestic institutions and $10.1b in = bonds=20 issued by non-residents; and $15.4b in short term securities (6.6% = of=20 their financial assets). At the end of the September = quarter 2008,=20 pension funds held $507.3b in shares and other equity (52.2% of = their=20 financial assets), of which $328.6b was in resident companies and = $178.7b=20 was in non-resident companies. They held $159.3b of the net equity = in life=20 office reserves (16.4% of their financial assets); and $94.0b in = bonds=20 (9.7% of their financial assets), of which $49.9b were bonds = issued by=20 domestic institutions and $44.1b were bonds issued by = non-residents.=20 Financial claims between households, = life=20 insurance companies, pension funds and investment managers at end = of=20 quarter At the end of the September quarter 2008, = households=20 had claims against the reserves of life insurance corporations of = $58.9b=20 and pension funds of $1,028.5b. Pension funds had claims against = the=20 reserves of life insurance corporations of $159.3b. Life insurance = corporations invested $142.7b of their financial assets through = investment=20 managers, and pension funds invested $455.5b through investment = managers.=20 Financial asset portfolio of other = insurance=20 corporations at end of quarter The graph below shows = that at=20 the end of the September quarter 2008, other insurance = corporations held=20 $39.0b in shares and other equity (29.4% of total financial = assets), of=20 which $29.5b was in resident corporations; $39.6b in bonds (29.9% = of total=20 financial assets), of which $35.7b was issued by resident = corporations;=20 and $11.1b of short-term securities (8.4% of total financial = assets).=20 Central borrowing authorities net = issue of debt=20 securities During the September quarter 2008, central = borrowing=20 authorities issued bonds of $2.8b and one name paper of $5.1b.=20 Financial intermediaries n.e.c. net = issue of=20 debt securities During the September quarter 2008, = financial=20 intermediaries n.e.c. had net redemptions of bonds of $14.7b and = one name=20 paper of $2.6b.=20 GENERAL=20 GOVERNMENT Summary During the September = quarter=20 2008, consolidated general government transactions resulted in a = net=20 change in financial position of $3.8b. The net change in = financial=20 position for national general government was $6.0b. The liability=20 transactions of national general government during the quarter = were=20 -$9.0b, with the main contributors being other accounts payable of = -$5.6b=20 and bonds issued domestically of -$3.0b. During the quarter asset=20 transactions for national general government were -$3.0b, with the = main=20 contributor being deposits of -$13.0b. At the end of the quarter, = national=20 general government had total liabilities of $196.8b and total = financial=20 assets of $200.2b. Transactions in state and local general=20 government financial assets were $0.2b in the September quarter = 2008,=20 while transactions in total liabilities were $2.4b, resulting in a = change=20 in financial position of -$2.2b. At the end of the quarter, state = and=20 local general government had total liabilities of $123.3b and = total=20 financial assets of $121.8b. Change in financial=20 position National government issue of debt=20 securities The graph below illustrates that national = general=20 governments had net maturities of $3.0b during the quarter.=20 HOUSEHOLDS Summary = Households=20 change in financial position was $10.5b during the September = quarter 2008.=20 During the quarter, households borrowed a total of $11.5b in the = form of=20 loans. On the asset side, householders' transactions in currency = and=20 deposits were $20.3b, of which $19.3 were bank deposits. Net = contributions=20 to life insurance and pension fund reserves were $12.7b while net = claims=20 on unfunded superannuation were $1.1b. Households sold a = net $4.1b=20 in equities during the September quarter 2008, the major = contributors=20 being the sale of private non-financial corporations shares, $3.2 = and=20 financial intermediaries n.e.c $1.1b. At the close of the = quarter,=20 households' stock of financial assets was $2,217.3b. This was a = decrease=20 of $51.9b from the previous quarter, following net transactions of = $27.9b=20 and valuation decreases of $79.8b. Major asset holdings were net = equity in=20 reserves of life insurance corporations and pension funds of = $1,087.4b,=20 currency and deposits of $548.0b, equities of $303.4b and unfunded = superannuation claims of $175.3b. Household net = borrowing=20 and debt to liquid asset ratio Of the net $11.5b loans = borrowed=20 by households during the September quarter 2008, bank loans = accounted for=20 $20.0b. This was offset by repayments to financial intermediaries = n.e.c.,=20 $8.6b. Of the bank loans, $15.6b was borrowed for owner occupied=20 housing. The graph below illustrates that the debt to = liquid assets=20 ratio at the end of September 2008 was at 146.9%, an increase of 3 = percentage points on the previous quarter. The ratio was = influenced by an=20 increase of 1.3% in total outstanding household borrowings and a = decrease=20 in total liquid assets of 0.8%. The major contributor to the = decline in=20 liquid assets was equities (down 10.4%). This was offset primarily = by=20 increases in currency and deposits of 5.4%.=20 Insurance and pension = claims During=20 the September quarter 2008, households' net equity in reserves of = pension=20 funds decreased by $47.4b, made up of $9.5b in transactions and = $56.9b in=20 valuation decreases, bringing household net equity in pension = funds to=20 $1,028.5b. Net equity in reserves of life insurance corporations = increased=20 $0.9b, made up of $3.2b transactions and $2.3b valuation = decreases,=20 bringing the household net equity in life insurance to $58.9b. Net = transactions in households' unfunded superannuation claims were = $1.1b and=20 prepayments of premiums and claims against reserves in other = insurance=20 corporations were $1.4b during the quarter. REST OF = THE=20 WORLD Summary Non-residents had net = transactions=20 of $35.4b in Australian financial assets during the September = quarter=20 2008, resulting in $1,778.1b of Australian financial assets being = held by=20 non-residents, up $38.6b from the June quarter 2008. Valuation = increases=20 were $3.2b. The main contributors were issuance of loans and = placements=20 $37.3b (of which $24.3b was issued to banks, and $17.9b to private = non-financial corporations) and net purchases of equities, $14.5b, = of=20 which $11.1b was in equities issued by private non-financial = corporations.=20 These were offset by net sales of bonds, $17.9, of which $10.1b = were in=20 bonds issued by the banks. Australian residents had net=20 transactions of $24.7b in foreign financial assets during the = September=20 quarter 2008. The total value of foreign assets held by Australian = residents increased to $1,068.5b at the end of the quarter. Of = this, $1.8b=20 were valuation decreases. The main contributors to the increase = were net=20 purchases of equity, $11.3b, and the issuance of loans and = placements,=20 $9.6b. These were offset by the net redemption of rest of the = world bonds=20 issued in Australia of $3.8b. Net purchases of=20 equities During the September quarter 2008, = non-residents=20 acquired a net $14.5b in equities, an increase of $1.3b compared = with the=20 June quarter 2008.=20 Net purchases of = bonds Non-residents=20 sold $17.9b of Australian bonds during the September quarter 2008, = a=20 decrease of $25.8b compared with the June quarter 2008 estimate.=20 HAVE YOUR = SAY 5232.0 -=20 Australian National Accounts: Financial Accounts will be reviewed = next=20 year as part of ABS implementation of new international = statistical=20 standards. We would value your input and assistance in helping to = shape=20 this publication to meet your needs. A short feedback form is = linked below=20 for your comments. Feedback=20 Form By clicking = on this=20 link, you will open a new window, and will be directed to a secure = website=20 external to the Australian Bureau of Statistics. This page last updated 17 December = 2008