Eurozone Loan Demand Declines In Q1: ECB

Euro area banks reported a sizeable decline in net demand for loans in the first quarter, bank lending survey data published by the European Central Bank revealed Wednesday.

The decline in demand for loans to non-financial corporations reflects a sharp drop in financing needs for fixed investment. Likewise, demand for loans to households dropped further.

For the second quarter, banks expect much less negative net demand for loans to households and a rise in demand for corporate loans.

The survey conducted between March 23 and April 5 showed that the net tightening of credit standards by euro area banks declined substantially in the first quarter, both for loans to non-financial corporations and for loans to households.

Looking ahead to the second quarter, banks expect another fall in the net tightening in credit standards for loans to non-financial corporations and for housing loans.