Central Bank of Malta statistics indicate that by the end of last October Maltese and Gozitan households had deposited with local banks the record figure of €15.2 billion.
Since January 2020 when Robert Abela was sworn in as prime minister, families have increased their savings by €2 billion, or an average of €96 million per month.
The average increase in savings during this administration is a historical record. It is around one and a half times the average monthly increase in deposits observed during the Joseph Muscat administration, which amounted to €67 million.
Looking at the average increase during the administration led by Lawrence Gonzi, this was only €24 million per month. Which means that in recent months the average rise in household savings has been four times that under two Conservative legislatures that preceded 2013. The same can be said when comparing with the average rise in bank deposits that occurred during the administration led by Eddie Fenech Adami which lasted between 1998 and 2004.
It should be recalled that after the 2008 economic crisis, the deposits of Maltese and Gozitan families had fallen strongly, by an average of almost €26 million per month. So much so that in November 2009 they had fallen to the level they had been in November 2007. Thus, under the administration led by Lawrence Gonzi, a much smaller economic shock led to families having to run down their savings, putting them back two years in terms of their bank account balances. This is the extent to which Maltese and Gozitan families had been left on their own during the 2008 crisis.
In contrast, this time round, not only did families not need to resort to running down their savings, but they also actually managed to improve their financial situation in an unprecedented way. The amount of money deposited with the banks by Maltese and Gozitan families today is €7.5 billion more than what was deposited when Lawrence Gonzi was Prime Minister.
This means that Maltese and Gozitan families have doubled their bank balances since then. Likewise, household bank deposits are now three times what they had been when Eddie Fenech Adami was last Prime Minister.
The strong financial situation of local households is the root cause of the strong recovery of Malta’s economy. Through their strong financial resources, households are increasing domestic demand. The investment in people made by the current administration is giving excellent returns as our country already boasts the highest rate of economic growth among all the countries of the European Union.