OeNB Report 2024/4: Bank Lending Survey – Households’ demand for housing loans has bottomed out

Austrian results of the euro area bank lending survey of April 2024

Gerald Hubmann ¹

Households’ demand for housing loans rose slightly in the first quarter of 2024 after having fallen sharply for a year and a half. The Austrian banks surveyed expect demand to increase further in the second quarter of 2024. The main reason for this emerging recovery is the prospect of falling interest rates from mid-2024.

Demand for corporate loans slowed down again in the first quarter of 2024, however, having been in decline already since the fourth quarter of 2022. In addition to declining corporate investment, higher interest rates in particular have curbed loan demand. By and large, the banks surveyed do not expect loan demand to decline further in the second quarter of 2024.

Since the second quarter of 2022, banks have substantially tightened their lending policies for corporate loans given rising risk levels pertaining to economic conditions, companies’ creditworthiness and, most recently, collateral value. In the second quarter of 2024, banks plan to tighten their lending policies further.

Note: The full report in German can be found at OeNB Reports .