Dear customers, in accordance with the requirements of the Law on the Introduction of the Euro in the Republic of Bulgaria, DCA applies dual displays of the amounts related to your debts, as well as the prices of DCA assets listed for sale. All amounts will be shown in leva and euro until 08.08.2026. You can find more information by clicking the "See more" button.
See more

Euro area banks unexpectedly tighten corporate lending standards

КредитиранеThe banks in the euro area apart from Bulgaria unexpectedly tightened lending standards for corporate loans at the end of last year, according to a survey by the European Central Bank (ECB). The main reason is the growing perception of risk and lower tolerance for it, as noted by the ECB. There was a slight easing in housing loans, but consumer loan standards were further tightened. While most countries in the eurozone reported a slight increase in demand for corporate loans and moderate growth in housing loans, statistics in Bulgaria show new records at the end of last year.

The tightening of lending had a weak effect on non-performing loans (NPLs) and other asset quality indicators, as noted in the report. At the end of last year 5% of surveyed banks reported deterioration, tightening, or an increase in asset quality indicators, including NPLs. In Bulgaria there is a different picture – at the end of December household loans, overdue for over 90 days, stood at 1.59%, while total NPLs in bank portfolios were 1.55%. In September, they were 1.83%, which was exactly the level of overdue household loans. Overall statistics for European banks at the end of December have not yet been published; the latest data is from September and shows 2.22%, unchanged from June, with a downward trend in recent years (see the chart).

View EN_NPL_BNB_ECB_Q4_2025 on Beautiful.ai

In Europe as a whole tensions in trade relations and related uncertainties are exacerbating the tightening of requirements for borrowers and reducing loan demand, experts note. For the first quarter of this year, banks expect the tightening of standards for corporate loans to continue, as well as for mortgage loans, while requirements for consumer loans will be even more stringent.

At the end of last year, demand for corporate loans was driven mainly by innovation development and the need for working capital, refinancing and debt restructuring, as well as mergers and acquisitions, according to the Central bank. Demand for mortgage loans increased due to improved prospects in the real estate market. At the same time, consumer confidence negatively affects the demand for the respective type of loans. Banks’ forecasts indicate that there will be a slight increase in demand for both consumer and mortgage loans in the first quarter of this year.

Read more news here.