FRANKFURT: New lending to euro zone companies plunged in April, indicating that banks are tightening access to credit even as the bloc starts to emerge from a year of lockdowns, data from the European Central Bank showed on Monday.
With a third wave of the pandemic receding in the region, economic activity started to pick up in April after a double dip recession but large chunks of the services sector remained shuttered and with depleted balance sheets.
The monthly flow of loans to euro zone companies was a negative 26.8 billion euros in April, reversing much of the 51.1 billion euro ($62.3 billion) rise a month earlier, dragging the annual growth rate of new loans to a 14-month low of 3.2% after last month’s 5.3%.
The monthly drop is the second deepest on record, only exceeded by a 28.6 billion plunge in June 2009, at the height of the global financial crisis.
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