Key Findings of the ECRI Statistical Package 2018
The ECRI Statistical Package 2018 reveals that total lending to households and Non-Financial Corporations (NFCs) in the EU increased in real terms in 2017, following the trend reversal in 2015 and positive growth in 2016. Despite this, the level of lending still falls short of the pre-crisis 2007 level for the EU28, the EU15 and the EA19, but not for the NMS (which are now above the 2007 level).
At a more granular level, lending to households has experienced (small) positive real growth in 2017, but generally at a slower pace than in 2015 and 2016. Lending to households can be disaggregated in consumer credit, housing loans, and other loans. Both consumer credit and housing loans follow a similar pattern to total household lending: they have increased in 2017, but with smaller magnitudes than in 2016. Growth in total lending to households, consumer credit and housing loans in the EU28 was mainly driven by France, Germany and the Netherlands.
2017 has been a crucial year for loans to NFCs: for the first time since 2010, the EU28, the EU15 and the EA19 have experienced positive real growth in outstanding loans to NFCs, bringing to an end a seven-year contractionary period. While a positive sign, caution is appropriate as positive growth remains weak and limited to few countries. Germany, France and Sweden, in particular, are the countries that contributed the most to the trend reversal.
This paper analyses all of the above in further detail, providing the reader with a granular representation of European credit market developments in 2017. The discussion breaks down the data by country group, by individual countries, by currency, and by maturity. Furthermore, lending is analysed in terms of real levels, real year-on-year growth, real cumulative growth, per capita level, as a percentage of gross disposable income, and as a percentage of GDP. Each section also includes a discussion of sigma and beta convergence in relative measures of credit within country groups. Finally, the paper concludes with a regression analysis of the drivers of European lending markets, using data for the 1995-2017 period.
Sylvain Bouyon is a Research Fellow, Head of Fintech and Retail Finance at CEPS and ECRI. Pietro Gagliardi is a Research Intern at CEPS and ECRI.