Credit demand expected to surge

CREDIT demand for corporate activity on a Europe-wide basis is expected to surge over the current quarter, following inactivity in bank lending.

The latest quarterly bank lending survey from the ECB covering the three months to the end of June showed credit flow was tight, partially prompted by a 2% net fall in demand from the corporate sector.

However, Ernst & Young said this quarter is likely to see higher demand, bolstered by a rise in the appetite to fund inventory purchases and in general mergers and acquisitions.