About 65% of domestic debt is held by banks - Most of it is in bonds. The ratio to GDP is also falling
Domestic debt has reached record levels this year. According to the Ministry of Finance's statistical bulletin, this stock is estimated to have reached 798 billion lek, a figure about 1.3% higher than in 2024.
The majority of domestic debt is in long-term instruments. About 74% of it is in bonds and only 24% in short-term instruments, i.e. treasury bills. In terms of long-term instruments, 5-year bonds have the highest value of 137 billion lek, while 20-year bonds, which were issued for the first time this year as a market test, have the lowest weight in debt.
Regarding treasury bills, 12-month ones reach a figure of 184 billion lek, while domestic debt in 3-month bills appears to have increased for the first time since 2023. Debt in bonds has increased by 13.5% compared to 2023, while that in short-term instruments continues to decline.
Unlike 2023 where domestic debt was 99% in lek and 1% in foreign currency, in 2024 and the second quarter of 2025, all debt was in our national currency.
Official statistics show that the majority of the government's domestic borrowing is held by banks, meaning most government securities are purchased by them.
About 9.5% of the domestic debt is held by individuals, 14.7% by financial institutions, 7.4% by the Bank of Albania, 0.6% by foreigners and almost 64.8% is held by the banking system, of which 8.8% by the bank's customers themselves.
In relation to Gross Domestic Product (GDP), the total stock of domestic debt is recorded at 30.5%, thus marking a decrease of almost 02.6%.
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