Bank Lending: Europe

Developments

Total Loans	Balance (Trillions)		Growth Rates Y/Y		Flows (Billions)
Date	Households	Corporate	Households	Corporate	Households	Corporate
10/31/2023	6,870	5,126	0.60	-0.30	404	8,452
9/30/2023	6,871	5,121	0.80	0.20	5,732	-2,763
8/31/2023	6,867	5,124	1.00	0.70	-4,129	-37,410
7/31/2023	6,871	5,163	1.30	2.20	-4,955	12,906
6/30/2023	6,877	5,152	1.70	3.00	20,053	772
5/31/2023	6,859	5,153	2.00	4.00	2,502	-1,998
4/30/2023	6,854	5,152	2.50	4.70	1,103	7,100
3/31/2023	6,855	5,148	2.90	5.30	10,919	15,714
2/28/2023	6,847	5,143	3.20	5.70	-2,825	85
1/31/2023	6,851	5,143	3.60	6.10	-9,369	-1,967
12/31/2022	6,839	5,128	3.80	6.40	-1,297	-25,901
11/30/2022	6,845	5,166	4.10	8.30	24,431	9,640
10/31/2022	6,825	5,159	4.20	8.90	13,055	33,715
9/30/2022	6,813	5,132	4.40	8.90	20,587	21,997
8/31/2022	6,793	5,108	4.50	8.80	13,253	40,756
7/31/2022	6,781	5,069	4.50	7.60	21,655	52,666
6/30/2022	6,757	5,014	4.60	6.90	43,581	47,744
5/31/2022	6,716	4,971	4.60	6.00	32,258	28,986
4/30/2022	6,686	4,940	4.60	5.40	24,164	34,248
3/31/2022	6,661	4,902	4.50	4.30	33,067	36,903
2/28/2022	6,629	4,865	4.40	4.60	19,535	17,432
1/31/2022	6,611	4,855	4.30	4.50	5,438	9,859

August 2023

• The annual growth rate of adjusted loans to the private sector (i.e. adjusted for loan sales, securitisation and notional cash pooling) decreased to 0.6% in August from 1.6% in July.
• The annual growth rate of adjusted loans to households decreased to 1.0% in August from 1.3% in July
• The annual growth rate of adjusted loans to non-financial corporations decreased to 0.6% in August from 2.2% in July.

February 2023

• The banks cut their lending to eurozone businesses by 3 billion euros in February, equivalent to $3.23 billion, while the increase in lending compared with a year earlier slowed to 4.9% from 5.3% in January.
• There was also a slowdown in lending to households.

September 2023

• In September 2023 the growth rate of loans to households in the euro area for house purchase was 0.83%. The average interest rate on these loans was 3.93%. Ten years before, September 2013, the average interest rate was 3.06%.
• In September 2023 the annual growth rate of all loans to companies in the euro area was 0.2% and the total volume of loans granted to companies was € 5 118 billions. The average interest rate was 5.09% in September 2023.

Bank lending survey

Q2 2023

• In the July 2023 BLS, euro area banks reported that their credit standards for loans or credit lines to enterprises tightened further in the second quarter of 2023. The net tightening was in line with what banks had expected in the previous quarter, remaining above the historical average since the start of the survey in 2003.
• In the third quarter of 2023, euro area banks expect a further net tightening of credit standards for loans to firms, but at a slower pace than in the second quarter.
• In the third quarter of 2023, euro area banks expect credit standards to remain unchanged for households for house purchase, while a further net tightening is expected for consumer credit and other loans to households, although to a lesser extent than in the second quarter.
• Firms’ net demand for loans fell strongly in the second quarter of 2023, dropping to an all-time low since the start of the survey in 2003. The decline in net demand reflects the impact of rising interest rates on loan demand and economic growth. Fixed investment also had a strong dampening impact on loan demand, mirrored by a strong net decrease in demand for long-term loans. In the third quarter of 2023, banks expect a further net decrease in demand for loans to firms, but much smaller than in the second quarter.
• Euro area banks also reported a strong net decrease in demand for housing loans which, however, was lower than the very large net decrease in the previous two quarters. Higher interest rates, weakening housing market prospects and low consumer confidence all contributed negatively to the demand for loans for house purchase. In the third quarter of 2023, banks expect a further, although markedly less pronounced, net decrease in housing loan demand, and a further net decrease in demand for consumer credit.
• Euro area banks reported that their access to funding deteriorated in most market segments in the second quarter of 2023, especially in retail funding.
• Euro area banks reported a net tightening impact of NPL ratios on their lending conditions for loans to enterprises and consumer credit in the first half of 2023.
• In the second quarter of 2023, banks reported a further net increase in the share of rejected applications for loans to firms (net percentage of 16%, after 15%). Banks mentioned more often, in net terms, an increase in the share of rejected loans for small and medium-sized enterprises (SMEs) than for large firms.
• Euro area banks reported a further net increase in the share of rejected applications also for loans to households, which was lower than the previous quarter for housing loans (8%, after 17%) and similar to the previous quarter for consumer credit (10%).