FRANKFURT (Reuters) - The concentration of wealth among the euro zone’s richest has increased since the bloc’s debt crisis began, with poor families suffering the biggest drop in asset values, a survey released by the European Central Bank showed on Friday.
The euro zone’s top 5 percent of households owned 37.8 percent of net wealth in 2014, up from 37.2 percent in 2010 while the bottom 5 percent owned only debt, the ECB said, based on a survey of 84,000 households.
Suffering from waves of recession, the bloc’s protracted debt problem has worsened inequalities as states on the periphery like Italy, Spain, Portugal and Greece struggled, while those in the core, like Germany, were quicker to recover.
The median wealth of a euro zone household dropped around 10 percent to 104,100 euros ($108,800) in the four years to 2014, mostly as property prices fell, especially for the poorest fifth of the population, the ECB said.
”The shift was particularly substantial in Greece and Cyprus, where the median fell by roughly 40 percent... but it is also large in Italy, Portugal, and Spain, where it declined by more than 15 percent,“ the ECB said,” the ECB said.
Bucking the trend, median wealth in German, the bloc’s economic powerhouse, increased by 10 percent over the same period. It also edged up in Austria, Finland and Luxembourg.
To reach the top 10 percent, households needed to hold net wealth of 496,000 euros or more, while the lowest 10 percent had 1,000 euros or less.
“The fall in net wealth was mainly driven by a reduction in the value of assets, in particular real estate,” the ECB said. “The decline in net wealth was higher for leveraged households, especially homeowners with a mortgage, compared with outright homeowners and renters.”
The property price fall, a consequence of the bloc’s economic crunch, hurt the poorest the most - real estate wealth was down by a fifth for the poorest 40 percent, twice the rate of the drop affecting the richest 20 percent, the ECB said.
Families in Luxembourg, where the financial sector dominates the economy, were the richest, with a median net wealth of 437,500 euros. In the formerly Soviet, Baltic state of Latvia, it was just 14,200 euros.
($1 = 0.9568 euros)
Reporting by Balazs Koranyi; editing by Mark Heinrich