PRESS RELEASE: Corporate debt grows faster than Estonian economy
The most recent statistics of the payment behaviour of companies prepared by Creditinfo Eesti AS indicate that debts grew faster in the second half of 2017 than the economy with 9 and 4.9 percent, respectively.
Although the proportion of companies with debts remained the same in the second half of 2017 as in the second half of 2016 (8.1%), the total debt is growing and has reached 93.3 million euros. The average amounts of payment defaults and tax arrears have also increased. The median average amount of payment defaults has increased by 6.5% from 1,000 euros to 1,065 euros and the median average amount of tax arrears has increased by 10% from 2,915 euros to 3,206 euros.
The agricultural sector stands out with the biggest payment default, which totals 13.3 million euros. However, it must be noted here that the majority (86%) of this debt consists of the payment fault of just one company.
The number of companies with high credit risk in Estonia remained at the lowest level of the last three years in the second half of 2017 with 12.4%. The share of payment defaults and tax arrears remains stable both in the county division as well as according to areas of activity.
The aggregate amount of payment defaults and tax arrears amounted to 93.4 million euros in the second half of 2017. The number of companies with payment defaults in the second half of 2017 was 3.3% or 2,940 active companies. The share of companies with tax arrears has increased from 4.8% to 6.1% in comparison with the same period last year, i.e. 5,338 actively operating Estonian companies owe money to the state.
The statistics of the payment behaviour of companies are based on the credit opinions of Creditinfo Eesti AS and the data of the Official Payment Defaults Register and the Tax and Customs Board. The sample consisted of 88,222 actively operating Estonian companies. Creditinfo has been presenting information about the payment behaviour of companies for 10 years now and does it twice a year. The objectives of the study are to observe and, if necessary, regulate the methodology of the credit rating of companies to guarantee quality credit information to the decision-makers.
You can read the full study on the Creditinfo website: Payment Behaviour of Companies in Second Half of 2017
Creditinfo Eesti AS is a subsidiary of the Creditinfo Group that provides credit information, risk management services and market information solutions and is the market leader in its sector in Estonia. Our goal is to help entrepreneurs so they can make correct business decisions quickly, keep their debts under control and increase their turnover.
Anne-Ly Ots, Chief Analyst at Creditinfo Eesti AS
T: 665 9627