January 2020 euro area bank lending survey

• Credit standards remained broadly unchanged for both loans to enterprises and housing loans
• Demand for loans to enterprises declined, while demand for housing loans increased further
• Euro area banks use TLTRO-III liquidity largely for granting loans

Credit standards – i.e. banks’ internal guidelines or loan approval criteria – remained broadly unchanged for both loans to enterprises and loans to households for house purchase in the fourth quarter of 2019, according to the January 2020 bank lending survey (BLS), in line with expectations expressed in the previous survey round.

Credit standards for consumer credit and other lending to households tightened further, despite expectations that they would remain broadly unchanged.

Risk perceptions (relating to both the general economic situation and the firm-specific situation) continued to have a tightening impact on the credit standards applied to loans to enterprises. Looking ahead to the first quarter of 2020, banks expect credit standards for loans to enterprises to remain unchanged, while they expect credit standards to tighten for housing loans and to ease for consumer credit and other credit to households.

Banks’ overall terms and conditions – i.e. the actual terms and conditions agreed in loan contracts –remained broadly unchanged in the fourth quarter of 2019 for new loans to enterprises and housing loans, while they eased for consumer credit.

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