Slight decline in net tightening of credit standards - Results of the July 2011 bank lending survey
The European Central Bank July 2011 bank lending survey for the euro area report a slight decline in net tightening of credit standards in comparison with the first quarter of 2011. The bank lending survey, which is conducted four times a year was developed by the Eurosystem in order to enhance the understanding of bank lending behaviour.<br/><br/>
In the July 2011 Banking Lending Survey (BLS), euro area banks generally reported a slight decline in net tightening of credit standards in comparison with the first quarter of 2011. This held true for both loans to enterprises (2% net tightening, after 4% in the first quarter) and loans to households for house purchase (9% from 13% in the first quarter). In the case of consumer credit, banks generally reported an unchanged degree of net tightening, namely 7%.
The results reported in the July 2011 survey relate to changes in the second quarter of 2011 and to expectations of changes in the third quarter of 2011. This survey round included three ad hoc questions. The first aimed at gauging the extent to which the financial market tensions affect banks’ credit standards for loans and credit lines to enterprises and for loans to households in the euro area. The two new ad hoc questions aimed at assessing the possible impact of the implementation of the new Basel III regulations (or any other specific national regulations concerning banks’ capital that have recently been approved, or are expected to be approved in the near future). The July 2011 bank lending survey was conducted between 17 June and 1 July 2011. With 124 banks participating in the survey, the response rate was 100%.
Looking ahead to the third quarter of 2011, euro area banks expect a slight increase in the net tightening of credit standards for enterprises, to 6%. For housing loans, they expect unchanged levels of net tightening (9%), while a marginal decline in net tightening (to 6%) is expected in the case of consumer credit