Pace of tightening of euro-area credit standards declines
The latest Euro Area Bank Lending Survey from the European Central Bank notes that in the second quarter of 2009 the net percentage of banks reporting a tightening of credit standards applied to loans and credit lines to enterprises more than halved to 21%, compared with 43% in the first quarter.
The report notes that supply-side factors in particular, such as banks' access to market financing and banks' liquidity positions contributed to the decline in the net tightening of credit standards
The report also notes that net demand for loans by enterprises continued to decline, but the decline was somewhat smaller than in the first quarter. The report notes that the decline in net demand was driven by a strong decrease in the financing needs for fixed investment and by a further considerable fall in demand stemming from mergers and acquisitions and corporate restructuring.
118 euro-area banks took part in the survey.
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