Debt service ratios

About

The data set for debt service ratios reflects the share of income used to service debt for households, non-financial corporations and the total private non-financial sector. It provides important information about interactions between the financial and real sectors, and is a reliable early warning indicator for systemic banking crises.

The published series for the total private non-financial sector cover 32 economies, starting at earliest in 1999. The data set also includes a breakdown for households and non-financial corporations, estimated for 17 economies.

To derive the DSRs on an internationally consistent basis, the BIS applies a unified methodological approach and uses, where available, input data compiled on an internationally consistent basis (total stock of debt, income available for debt service payments, average interest rate on the existing stock of debt and the average remaining maturity). Although the applied methodology is subject to an approximation error when aggregate data are used, it correctly captures how the DSR in a particular country changes over time. However, it may not accurately measure the DSR level compared with the result that may be obtained from micro data.

For practical purposes, it is more meaningful to compare national DSRs over time (eg by removing country-specific means) rather than to compare their absolute levels, which are difficult to pinpoint. This approach also takes account of different institutional and behavioural factors affecting average remaining maturities.

For further details of the methodology, see "How much income is used for debt payments? A new database for debt service ratios", BIS Quarterly Review, September 2015.

Metadata

Seasonal adjustment: Non seasonally adjusted
Frequencies: Quarterly
Contact: BIS statistics
Units: Per cent

Next release date: 8 December 2025
Last release date: 15 September 2025

Methodology

Debt service ratios for the private non-financial sector – data documentation and sources

DSRs are derived from aggregated data based on a unified methodology which captures the dynamics of DSRs over time. It is more meaningful to compare national DSRs over time (by, for instance, removing country-specific means) rather than compare their absolute levels which are difficult to pinpoint. This approach also takes account of different institutional and behavioural factors affecting average remaining maturities.

13 Sept 2015

How much income is used for debt payments? A new database for debt service ratios

Mathias Drehmann, Anamaria Illes, Mikael Juselius and Marjorie Santos

Debt service ratios (DSRs) provide important information about the interactions between debt and the real economy, as they measure the amount of income used for interest payments and amortisations. Given this pivotal role, the BIS has started to produce and release aggregate DSRs for the total private non-financial sector for 32 countries from 1999 onwards. For the majority of countries, DSRs for the household and the non-financial corporate sectors are also available. This article explains the key concepts underlying the compilation of the new series and it shows that the DSRs are meaningful, even when derived from a relatively sparse set of aggregate data. A brief look at the evolution of DSRs in recent years highlights that they allow for a more comprehensive assessment of credit burdens than the credit-to-income ratio or simple measures of interest payments relative to income.

Research and publications

11 Dec 2024

Aggregate debt servicing and the limit on private credit

Mathias Drehmann

, Mikael Juselius

and Sarah Quincy

16 Dec 2018

The financial cycle and recession risk

Claudio Borio

, Mathias Drehmann

and Dora Xia

Financial cycle booms can end in crises and, even if they do not, they tend to weaken growth. Given their slow build-up, do they convey information about recession risk? We compare the predictive performance of different financial cycle proxies with that of the term spread - a popular recession indicator. In contrast to much of the literature, our analysis covers a large sample of advanced and emerging market economies. We find that, in general, financial cycle measures provide valuable information and tend to outperform the term spread. ...

11 Mar 2018

Early warning indicators of banking crises: expanding the family

Iñaki Aldasoro

, Claudio Borio

and Mathias Drehmann

Household and international debt (cross-border or in foreign currency) are a potential source of vulnerabilities that could eventually lead to banking crises. We explore this issue formally by assessing the performance of these debt categories as early warning indicators (EWIs) for systemic banking crises. ...

3 Dec 2017

Is there a debt service channel of monetary transmission?

Boris Hofmann

and Gert Peersman

Previous research has explored the impact of private sector debt service ratios (DSRs), ie debt payments relative to income, on medium-term macroeconomic outcomes. This special feature, based on a study of 18 economies, finds that monetary policy shocks, in turn, have a significant impact on DSRs. We show that a monetary tightening leads to a significant and persistent increase in DSRs, with higher effective lending rates on the stock of debt outweighing a decline in the debt-to-income ratio. Moreover, the ...

3 Dec 2017

Household debt: recent developments and challenges

Anna Zabai

The responsiveness of aggregate expenditure to shocks depends on the level and interest rate sensitivity (duration) of household debt, as well as on the liquidity of the assets it finances. Household-level spending adjustments are more likely to be amplified if debt is concentrated among households with limited access to credit or with less scope for self-insurance. The way in which household indebtedness affects the sensitivity of aggregate expenditure matters for both macroeconomic and financial stability. Financial institutions can suffer balance sheet distress from ...

8 May 2015

Leverage dynamics and the real burden of debt

Mikael Juselius

and Mathias Drehmann

13 Aug 2013

Evaluating early warning indicators of banking crises: satisfying policy requirements

Mathias Drehmann

and Mikael Juselius

Early warning indicators (EWIs) of banking crises should ideally be evaluated on the basis of their performance relative to the macroprudential policy maker's decision problem. We translate several practical aspects of this problem - such as difficulties in assessing the costs and benefits of various policy measures as well as requirements for the timing and stability of EWIs - into statistical evaluation criteria. Applying the criteria to a set of potential EWIs, we find that the credit-to-GDP gap and a new indicator, the debt service ratio (DSR), consistently outperform other measures. The credit-to-GDP gap is the best indicator at longer horizons, whereas the DSR dominates at shorter horizons.

17 Sept 2012

Do debt service costs affect macroeconomic and financial stability?

Mathias Drehmann

and Mikael Juselius

Excessive private sector debt can undermine economic stability. In this special feature, we propose the debt service ratio (DSR) as a measure of the financial constraints imposed by private sector indebtedness, and investigate its association with recessions and financial crises. We find that the DSR prior to conomic slumps is related to the size of the subsequent output losses. Moreover, the DSR provides a very accurate early warning signal of impending systemic banking crises at horizons of up to one to two years in advance. We conclude that the DSR can serve as a useful supplementary indicator for the build-up of vulnerabilities in the real economy and financial sector.

Glossary

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FAQs

The BIS estimates of debt service ratios rely on simplifying assumptions (eg remaining maturities being fixed across time and across countries). The BIS Quarterly Review feature published in September 2015, How much income is used for debt payments? A new database for debt service ratios, shows that given these assumptions, it is difficult to pinpoint the level accurately and therefore it is more meaningful to compare national DSRs relative to their means rather than comparing their absolute levels. In a cross-country context, such an approach will also take account of different institutional and behavioural factors affecting average remaining maturities.