1 National Balance Sheet Accounts in Israel Methods and Uses

2 Contents Introduction Sources and Methods Main findings

3 Introduction The national balance sheet accounts were first published in 2002 for the year Since then the balance sheets have been prepared for the years 2001 to Over the years some changes have been made (no’ of sub sectors and types of instruments).

4 Sources and Methods The value of asset/liability can be derived from : - method related to an institutional sector - distribution of the total value of an asset/liability among various sectors.

5 Sources and Methods First phase: assets and liabilities are recorded in accordance with the data in each sector’s financial statements. Second phase: comparison between the sums of assets and the corresponding liabilities. Choosing the most reliable estimate. Third phase: if no information is available we use the “counterpart” method or the “residual derivation” method.

6 Sources and Methods Non Financial Corporations, Other Financial Intermediaries and Financial Auxiliaries – based on the analysis of the balance sheets of the corporations. Households – balance sheets of other sectors and information about specific assets known for the households (deposits and loans).

7 Sources and Methods Deposit Money Corporations – the main source is the Central Bank, Supervisor of banks, and some details are collected directly from the large banks. Pension and Provident Funds and Insurance Corporations – the source is the report of Capital Market of the Insurance and Saving division of the Ministry of Finance.

8 Sources and Methods Central Government – the source is the Ministry of Finance, Office of the Accountant General. NPISH and GNPI – survey of balance sheets for public and private NPI held by the CBS.

9 Sources and Methods The Tel Aviv Stock Exchange is the source for the market values of the quoted governmental bonds, quoted private bonds and shares. The source for the non financial assets is the net capital stock calculated in the NA using the PIM method (doesn’t include land).

10 Plans for the future Breakdown of assets and liabilities by maturity (to analyze liquidity risks). Compilation of up-to-date full quarterly national balance sheets. Adjustment to SNA 2008

11 Main findings Israel’s total national wealth – NIS 2,091 billion, which is 2.4 times GDP. The total assets – NIS 7,250 billion, which is 8.3 times GDP. The government debt (mainly bonds) – NIS 656 billion.

12 Main findings The total credit – NIS 1,763 billion. The loans from the banks – 44% from the total credit. Were mainly given to Non- Financial Corporations (33%) and the households (42%). Total credit to Non-Financial Corporations - NIS 502 billion Total credit to the Households – NIS 413 billion.

13 Distribution of assets

14 Distribution of liabilities

15 Ratio of financial assets to non- financial assets

16 Conclusions The balance sheets were first developed within the NA. The collaboration with the Central Bank has proved fruitful and has lead to wider use of the balance sheets, mainly for financial stability. The constant development of the balance sheets will make it possible to have further analyses in the future.