DEMAND FOR LOANS IN THE EURO AREA
2.1 ENTERPRISES
2.1.1 CREDIT STANDARDS FOR LOANS TO ENTERPRISES WERE EASED FURTHER IN
THE FOURTH QUARTER OF 2014
For the fourth quarter of 2014, banks reported a net easing of credit standards on loans to nonfinancial corporations (specifically, a net percentage of -5%, from -2% in the previous quarter;
see Chart 1 and Table A).
3, 4
As in previous quarters, this is again considerably below the
historical net tightening average since the start of the survey in 2003. The reported net easing is
in line with banks’ net easing expectations for the fourth quarter of 2014 at the time of the
October 2014 BLS round. Across firm size, credit standards were eased on loans to both large
firms and to small and medium-sized enterprises (SMEs). Overall, developments across
countries continued to become less diverse.
5
Among the largest euro area countries, credit
standards on loans to enterprises were eased in net terms particularly in Italy and to a more
limited extent in France, while remaining unchanged in Germany and Spain and continuing to
tighten in the Netherlands.
Looking ahead to the first quarter of 2015, euro area banks expect credit standards on loans to
enterprises to ease further in net terms (see Chart 1 and Table 1).
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3
In order to describe the developments of survey replies over time, the report refers to changes in
the “net tightening” or “net easing” of credit standards from one survey round to another. For example, a
lower net percentage of banks tightening their credit standards between two survey waves would be
referred to as a “decline in net tightening”. Similarly, higher net percentages of banks indicating a decline
in loan demand between two survey waves would be referred to as a “more pronounced net decline in
demand”.
4
While the BLS questionnaire asks banks to report on the changes in credit standards, it cannot be
entirely ruled out that the level of credit standards is also considered by some banks in their replies. These
effects limit in some cases the comparability of the results across countries. Evidence on the level of
credit standards was provided in the April 2014 BLS, based on an ad hoc question.
5
When reporting on country developments, the analysis in the text refers mainly to net percentage
developments in the countries themselves (such as the net tightening of credit standards or the impact of
factors on the net tightening) and only in a few instances to the contributions to the euro area net
percentages.
6
The calculation of a simple average for aggregating some factors to main categories assumes that
all factors have the same importance for the banks. This partly explains some inconsistencies in the
respective charts between the development of credit standards and the development of the main
underlying factor categories.
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