The July 2018 Bank Lending Survey in Spain

Abstract

The results of the Bank Lending Survey show that during 2018 Q2 credit standards for new loans eased slightly in all segments, both in Spain and in the euro area. Household demand for credit grew in both areas, while that from enterprises did so only in the euro area, holding stable in Spain. As regards funding, both Spanish and euro area banks generally perceived some improvement in access conditions to retail markets and a slight deterioration in practically all wholesale markets. During the first half of 2018, regulatory and supervisory measures are estimated to have been conducive, in both areas, to some increase in capital levels, and, in the case of the euro area, also in assets. According to Spanish banks, these measures are not expected to have appreciably impacted either their funding conditions or lending standards or margins on loans. In the case of the euro area, they provided for some easing in institutions’ funding conditions, along with a slight tightening in credit standards, not significantly affecting the margins applied in most segments. Banks in both areas highlighted, as the key factors for the setting of their margins, the search for yield and competitive pressures. Finally, the NPL ratio has not significantly affected Spanish institutions’ lending policies during the first half of 2018, while it has contributed to some tightening in the euro area