bne -

Czechs have long been some of the most cautious consumers and borrowers in Europe - a profile that leaves the economy almost totally reliant on exports for growth - but a recent poll says they are becoming even more conservative about taking on loans, especially to fund consumption.

According to a poll carried out by the by the Public Opinion Research Center (CVVM) of the Institute of Sociology of the Academy of Sciences, the number of Czechs that consider it unacceptable to burden their households with debt, particularly to finance vacations or the purchase of consumer goods, grew considerably in 2012. While mortgage borrowing to fund buying a house, or loans to run a business or study, are more acceptable, respondents still don't universally approve, reports CTK.

The survey, taken in January, said that borrowing to fund housing is acceptable for 85% of Czechs, a drop of 6 percentage points compared with a year previously. A stunning 14% of Czechs, 6pp more than in 2012, still see a mortgage as unacceptable. However, any bankers hoping the harsh austerity programme that has been running for several years might push Czechs into a bout of retail therapy will be sorely disappointed to hear that no more than 10% of respondents would be willing to take a loan for a vacation, while less than half would consider a loan to finance a car or large consumer product purchase.

Far from becoming the engine of economic growth in the way that their Russian and Turkish peers have during the crisis years, Czechs are less and less willing to spend their way through the uncertainty. The share of Czechs that would take such a consumer loan fell by between 2-4pp, while a full 88% view taking on debt to buy a holiday as unacceptable.

The results of the poll fit well with the general outlook on the Czech banking sector, which remains one of the most stable in Europe thanks to a loan/deposit ratio of well below 100. At the same time, analysts point out that the industry is one of the dullest for investors seeking strong value accumulation.

According to data from the Czech National Bank, Czech household debt at banks and financial institutions rose by close to CZK6.8bn in December to total CZK1.162 trillion (€45bn), reports CTK. Household debt in the Czech Republic equalled just 30% of GDP in 2011, according to central bank data, well under the 65% Eurozone average. According to CVVM, 17% of respondents face problems in repaying loans, the same percentage as last year.

A report published on February 27 by Czech daily Hospodarske noviny says that credit cards have gone the same way as bank loans during the crisis. The country's largest retail bank, Ceska Sporitelna, has seen the number of issued cards drop by 200,000 since 2008 to leave it with around 350,000. A full 42,000 of the bank's credit cards were handed back in 2012. In total in the Czech Republic, the number of credit cards shrank to just 2.3m by the end of last year.