Eurozone banks tightened credit access conditions in the fourth quarter and will continue to do so in the early months of 2024 due to increased risk perceptions about the economic outlook.
According to a survey of banks in the credit market published on Tuesday by the European Central Bank (ECB), 4% of eurozone banks have tightened conditions for companies to access credit.
This is a moderate increase compared to the previous quarter (12%), but it complements the significant increase in claims accumulated since 2022, which, together with weak demand, contributed to a drop in the growth rate of this type of loans.
Banks have also tightened their criteria for lending to families, although less so for mortgages and more so for consumer loans.
Specifically, 2% of banks increased requirements for obtaining a mortgage loan in the last quarter of 2023 (11% in the July-September period), and 11% made consumer lending more restrictive (16% in the previous quarter).
At the same time, demand for credit or credit from companies and consumers also declined in the fourth quarter of 2023, although less than in the previous period, mainly due to higher interest rates.
For the first time since early 2022, banks expect a slight recovery in demand for business loans and mortgages in the first quarter of 2024.
Access to finance improved slightly for money markets, long-term deposits and debt securities, while access to short-term retail finance and securitization decreased slightly.
In addition, the ECB’s balance sheet contraction had a limited impact on lending conditions.
Author: Lusa
Source: CM Jornal
I’m Tifany Hawkins, a professional journalist with years of experience in news reporting. I currently work for a prominent news website and write articles for 24NewsReporters as an author. My primary focus is on economy-related stories, though I am also experienced in several other areas of journalism.