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Loans approved by banks in 2010 up 3.6 % in real terms

Autor: mses
ZAGREB, March 4 (Hina) - The moderate activity of commercial banks in loan approval in 2010 was mainly directed at the corporate sector, with no recovery in credit placement in the retail banking due to unfavourable trends on the labour market, citizens tightening their belts as well as due to the absence of any substantial decrease in interest rates, the Croatian National Bank (HNB) has reported.

According to figures in the latest HNB bulletin, the placement of loans to the non-banking sector continued mildly rising, reaching the growth rate of 6.9 percent on the year in December 2010.

Compared to the placement contraction in 2009, these trends indicated a moderate recovery in credit placement in 2010.

However, the central bank's analysts note that the nominal rise in loan placement should be ascribed considerably to the depreciation of the national currency against the euro and the Swiss franc. If the impact of the exchange rate is excluded, the rise in loans would be twice lower, that is 3.6 percent.

Broken down by sector, credit placement to the corporate sector rose 0.7 percent in December, or 8.8 percent on the year in nominal terms and 7 percent in real terms.

A majority of loans approved to companies and businesses were for working capital, while demand for investment means was still weak, the HNB analysts said in the bulletin.

Loans granted to individuals were reduced by 0.3 percent in December. Without the impact of the exchange rate, loans granted to individuals contracted by 1.4 percent on the year.

In December, commercial banks' loans to the government increased by HRK 1.9 billion. The state's net liabilities to banks at the end of 2010 increased by 14.7 percent from the end of 2009.

(Hina) ms

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