Banks gave 6.8 percent more loans to companies
The recently strong flow of credit to companies in the euro area weakened slightly in the second corona wave. In October, the banks in the currency area extended 6.8 percent more loans to companies than a year earlier, as the European Central Bank (ECB) announced. In September and August the increase was 7.1 percent. During the crisis, many companies stocked up on loans as a precaution in order not to run into payment difficulties.
But recent surveys have shown that banks are increasingly concerned about credit risks, as the second wave of pandemics is significantly slowing economic recovery. The institutes issued 3.1 percent more loans to private households in October than a year earlier.
The ECB had launched extensive aid programs to maintain the flow of credit to the economy during the pandemic. Among other things, it purchases large volumes of bonds, including corporate debt, to support businesses. Your crisis bond program, called PEPP, is now invested at 1.35 trillion euros. The ECB had already signaled that in view of the second wave of pandemics it could probably increase its economic aid again in December.
The money supply M3 increased by 10.5 percent in October. Economists had expected an increase of 10.4 percent.