The economic slowdown and growing fears of recession, along with risks associated with the economic outlook, have caused a significant impact on lending standards, the European Central Bank (ECB) stated in its Bank Lending Survey (BLS) for the third quarter of 2022.
"In the October 2022 BLS, euro area banks indicated that they have further tightened their credit standards for loans or credit lines to enterprises in the third quarter of 2022," read the report, while adding that "the percentage of banks reporting a tightening of credit standards was considerably larger than the percentage of banks reporting an easing."
Moreover, in the following quarter of 2022, the banks in the euro area expect a more significant net tightening for credit standards on loans to companies compared with Q3 2022.
