In December, the financial institutions issued 7.0 percent more loans to companies than a year earlier.
(Photo: dpa)
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Frankfurt Despite the corona pandemic, large amounts of bank loans continued to flow to companies in the euro area at the end of the year. In December, the financial institutions issued 7.0 percent more loans to companies than a year earlier, as the European Central Bank (ECB) announced on Friday. In November the increase was 6.9 percent. The institutes extended 3.1 percent more loans to private households in December than a year earlier. The plus was at this level in November as well
Many companies secured loans as a precautionary measure during the virus crisis so as not to run into payment difficulties in the face of collapsing business. The ECB has launched extensive aid programs to support the economy. These include a billion dollar bond purchase program, which has already been expanded twice and is now invested to 1.85 trillion euros, as well as long-term loan injections for banks at very favorable conditions.
The M3 money supply, which is closely monitored by the euro watchdogs, increased by 12.3 percent in December. Economists had only expected an increase of 11.2 percent. The metric includes cash, deposits in current accounts, and money market paper and debt securities. M3 is considered to be an indicator of inflation developments in the medium and long term.
More: Inflation in Germany is increasing significantly
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