Term loans down by 11.6%

TERM loans of five years and longer to the non-financial corporate (NFC) sector fell by 11.6% on an annual basis in July, according to the Central Bank’s Money and Banking Statistics: July 2011.

Bloxham Stockbrokers chief economist Alan McQuaid said: “There is very little good news in these latest banking figures, with the annual rates of decrease for the main loans to the household sector continuing to rise in July, and no sign that the trend will change any time soon. Until the banking sector crisis is fully resolved and things improve on the labour market front then the supply/demand for credit will remain subdued in our view.

“The net flow of household lending during the month of July 2010 was minus €716 million. The monthly net flow of loans to households averaged minus €821m in the three months ending July 2010, which consists of an average net flow of minus €138m in loans for house purchase, minus €399m in consumption loans and minus €283m in lending for other purposes,” the report states.