Eurozone banks impose tougher
credit conditions on SMEs.
Antonio
Fabrizio
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Access to finance continues to be a
challenge for small and medium-sized enterprises across Europe,
reports from the European Central Bank (ECB) and the Bank of
England (BoE) have revealed.
A bank lending survey published by
the ECB in July showed a further increase in the net tightening of
credit standards with respect to SME financing. The quarterly
survey of 120 eurozone banks showed that between April and June
2010 banks were imposing tougher conditions on loans than on the
preceding three months.
The percentage of banks tightening
their credit lines to SMEs increased to 14% from 4% in the first
quarter of the year.
The ECB added that demand for loans
from SMEs is becoming “less negative” (3% down compared to 9% down
in the first quarter). This is due to a “less negative”
contribution from factors such as fixed investment; and higher
demand of substitute sources of financing – debt securities
issuance in particular.
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By GlobalDataBoE figures show that lending to SMEs has dropped every month
since October 2009. Its August report suggested that credit
conditions for smaller businesses remain tighter than for larger
corporates, with overall demand for finance from SMEs falling back
in the second quarter after a recovery in the first quarter.
