Featured Product

    BoE Survey Examines Trends in Credit Conditions of Banks

    July 16, 2020

    BoE published results of the credit conditions survey for the second quarter of 2020. The survey was conducted among bank and building society lenders and it covered secured and unsecured lending to households and lending to non-financial corporations, small businesses, and non-bank financial firms. The results are based on lenders’ responses to the survey and are reported as net percentage balances. The results show that the availability of secured and unsecured credit to households decreased in the second quarter while the availability of credit to the corporate sector decreased during this time period.

    The lenders expect the availability of secured and unsecured credit to decrease further in the third quarter. The results also highlight that demand for secured lending for both house purchase and remortgaging decreased in the second quarter, but it is expected to increase in the third quarter. Lenders reported that the overall demand for unsecured lending decreased in the second quarter, comprising a decrease in both demand for credit card and other unsecured lending. However, the lenders expect the overall demand for unsecured lending to increase in the third quarter. The net percentage balance for changes in losses given default on secured loans decreased in the second quarter, but is expected to increase in the third quarter. The net percentage balance for changes in default rates for total unsecured lending increased in the second quarter and is expected to increase further in the third quarter.

    Lenders reported that the availability of credit to the corporate sector increased for all business sizes in the second quarter. Total corporate credit availability was expected to increase only slightly in the third quarter. Several lenders noted that the schemes recently launched by the government to support lending to businesses underpinned the reported increase in availability in the second quarter. Lenders reported that demand for corporate lending from businesses of all sizes increased in the second quarter, but expected to decrease in the third quarter. Furthermore, the length of interest-free periods on credit cards for balance transfers, and on purchases, decreased in the second quarter and lenders expected both to decrease in the third quarter.

    The credit conditions survey, which is aimed at improving the understanding of trends and developments in credit conditions, was conducted between June 01, 2020 and June 19, 2020. Lenders were asked to report changes in three months till the end of May 2020 (second quarter), relative to the period between December and February, and expected changes in the three months till end of August 2020 (third quarter), relative to the period between March and May. The credit conditions survey for the third quarter of 2020 will be published on October 15, 2020. 

     

    Related Link: Survey Results and Related Documents

     

    Keywords: Europe, UK, Banking, Credit Risk, Credit Conditions Survey, Default Risk, Mortgage Lending, BoE

    Related Articles
    News

    PRA and FPC Finalize Changes to Leverage Ratio Framework in UK

    The Prudential Regulation Authority (PRA) published the final policy statement PS21/21 on the leverage ratio framework in the UK. PS21/21, which sets out the final policy of both the Financial Policy Committee (FPC) and PRA

    October 08, 2021 WebPage Regulatory News
    News

    CFPB Proposes Rule on Small Business Lending Data Collection

    The Consumer Financial Protection Bureau (CFPB) proposed to amend Regulation B to implement changes to the Equal Credit Opportunity Act (ECOA) under Section 1071 of the Dodd-Frank Act.

    October 08, 2021 WebPage Regulatory News
    News

    PRA Decides to Maintain O-SII Buffers for Another Year

    The Prudential Regulation Authority (PRA) decided to maintain, at the 2019 levels, the buffer rates for the Other Systemically Important Institutions (O-SII) for another year, with no new rates to be set until December 2023.

    October 08, 2021 WebPage Regulatory News
    News

    FSB Report Assesses Implementation of Recommendations on Stablecoins

    The Financial Stability Board (FSB) published a progress report on implementation of its high-level recommendations for the regulation, supervision, and oversight of global stablecoin arrangements.

    October 07, 2021 WebPage Regulatory News
    News

    APRA Updates Loan Serviceability Expectations for Home Lending

    In a letter to the authorized deposit taking institutions, the Australian Prudential Regulation Authority (APRA) announced an increase in the minimum interest rate buffer it expects banks to use when assessing the serviceability of home loan applications.

    October 06, 2021 WebPage Regulatory News
    News

    CPMI and IOSCO Consult on Guidance on Stablecoin Arrangements

    The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) are consulting on the preliminary guidance that clarifies that stablecoin arrangements should observe international standards for payment, clearing, and settlement systems.

    October 06, 2021 WebPage Regulatory News
    News

    EBA and EIOPA Set Out Work Priorities for 2022

    The European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA) have set out their respective work priorities for 2022.

    October 05, 2021 WebPage Regulatory News
    News

    MFSA Issues Reporting Updates and Guidance for Banks

    The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0, in addition to the reporting module on leverage under the common reporting (COREP) framework.

    October 05, 2021 WebPage Regulatory News
    News

    EC Publishes Decision on List of Equivalent Third Countries Under CRR

    The European Commission (EC) published the Implementing Decision 2021/1753 on the equivalence of supervisory and regulatory requirements of certain third countries and territories for the purposes of the treatment of exposures, in accordance with the Capital Requirements Regulation or CRR (575/2013).

    October 04, 2021 WebPage Regulatory News
    News

    EC Rule on Contractual Recognition of Write-Down and Conversion Powers

    EC published the Implementing Regulation 2021/1751, which lays down implementing technical standards on uniform formats and templates for notification of determination of the impracticability of including contractual recognition of write-down and conversion powers.

    October 04, 2021 WebPage Regulatory News
    RESULTS 1 - 10 OF 7552