In the 1st quarter, eurozone banks reduced the issuance of loans

European banks significantly tightened lending requirements and reduced lending in the first quarter amid financial sector uncertainty caused by the collapse of several banks in the US, according to a study by the European Central Bank (ECB).

“The tightening of conditions for issuing corporate and mortgage loans in the last quarter turned out to be more significant than banks expected,” and this draws attention to the continued weakness in lending indicators, the ECB said in a survey. In particular, the drop in demand for corporate loans was the largest since the 2008 global financial crisis.

The study is based on a survey of 158 eurozone banks conducted between March 22 and April 6, 2023.

Euro zone lending data for the first quarter could influence the ECB’s decision on interest rates, which will be taken at its next meeting on Thursday. Market participants generally expect rates to be raised by 25 basis points, although many see the possibility of a 50 bp hike.

Be the first to read breaking news on OopsTop.com. For today’s latest news, and live news updates read the most reliable English news website Oopstop.com

Leave a Reply