MADRID, 19 (EUROPA PRESS)
In the second quarter, the banks of the euro zone “tightened considerably” the credit standards for their loans or lines of credit to companies and undertook “a strong net tightening of the credit criteria” for the granting of mortgages, while facing the third In the quarter, entities expect a net tightening of credit standards of a magnitude similar to that of the second quarter.
According to the survey of bank loans, carried out by the European Central Bank (ECB) between June 10 and 28 with the participation of 153 banks, the internal guidelines or the approval criteria of banks for loans or lines of credit to companies they tightened considerably during the second quarter.
As for loans to households for house purchase, euro area banks saw a sharp net tightening of credit standards, while standards for consumer credit and other loans to households tightened moderately.
The entities consulted cited the greater perception of risk and a lower tolerance for risk, within the current context of high uncertainty, continuous interruptions in the supply chain and high prices of energy and inputs, as factors behind the net tightening of standards. loans for companies.
Also, with monetary policy becoming less accommodative, euro area banks also reported that constraints on their cost of funds and balance sheets had contributed to tightening credit standards for lending to businesses and households. .
Looking ahead to the third quarter, entities expect a net tightening of credit standards for business loans “of a magnitude similar to that of the second quarter”, while they anticipate that credit standards will continue to tighten for both home loans and for consumer loans.
On the other hand, banks reported an increase in the demand for loans or provision of lines of credit by companies in the second quarter, driven by the financing needs of companies for working capital, which is probably related to higher energy and commodity prices in the context of ongoing supply chain disruptions, while fixed investment had a tempering impact on companies’ net borrowing demand, indicating they may be postponing investing in the current uncertain environment.
Also, in the second quarter, the net demand for loans for house purchase fell after having increased in the first quarter, while the demand for consumer credit and other loans to households continued to increase in net terms.
As explained by the ECB, the net decrease in demand for housing loans was mainly due to lower consumer confidence and the general level of interest rates, while the increase in demand for consumer loans was mainly due to spending on durable goods.
For the third quarter, banks expect a net decline in business loan demand, a sharp net decline in mortgage demand, and virtually unchanged consumer credit demand.