These are the two main conclusions which can be drawn from the survey of bank lending by the Spanish Central Bank in 3Q, which suggests that thanks to the end of economic recession the conditions of access to credit may soften.
Entities are feeling an improvement of access to markets, while retail funding has continued to evolve positively – deposits from households and companies grew at rates of 7% year on year in September.
However, some entities will continue to be under pressure by the balance exercise the ECB will make in the coming months.
Companies are getting better access to financing from the first quarter of the year and the contractionary effect of deterioration of economic expectations has been reduced since the second quarter.
As for the current trimester, banks foresee a slight relaxation of the criteria for granting of credit to SMEs and large companies, and a reduction in business funding requests. While in the first quarter 50% of institutions saw credit applications fall, now this percentage has been reduced to 10%.
With regard to domestic economies, one can observe an evolution similar to companies’, with the disappearance of the contractionary effect of economic expectations and the evolution of the residential market. Also, a a small increase in the demand of housing purchase has been detected, so a slight credit demand increase from households is expected during the current quarter.