The October 2017 Bank Lending Survey in Spain

The results of the Bank Lending Survey show that during the third quarter of 2017 credit standards in the households segment eased somewhat in both Spain and the euro area, while they tightened slightly for enterprises in Spain and remained virtually unchanged for enterprises in the euro area. Demand for loans to enterprises remained stable in Spain, whereas it increased across the euro area as a whole, and household demand grew in both areas. Spanish and euro area banks alike generally perceived unchanged or improved wholesale market access conditions, while in the case of retail markets, a slight deterioration in access conditions was perceived in Spain, which was not observed across the euro area as a whole. Meanwhile, the banks in the survey replied that the ECB’s expanded asset purchase programme has generally helped improve the financial situation over the last six months, except in the case of profitability in the euro area, which has been adversely affected. They also reported that the programme is continuing to encourage an easing of lending conditions for the private non-financial sector. Spanish and euro area banks alike reported that the ECB’s negative deposit facility rate caused a reduction in net interest income in the last six months, having a moderately negative impact on interest rates and the mark-ups on loans to households and businesses, and a positive (albeit small) effect on lending volumes.