The Lending Survey  published by the National Bank of Ukraine today points to a strengthening of the demand for corporate and household loans, with loan application approval rates increasing.

The survey, which  was carried out from 22 June 2017 through 7 July 2017, polled credit managers of 68 banks accounting for 97% of the total assets in the banking system.  The survey contains the second-quarter results and highlights expectations over the next quarter (Q3) and the next 12 months.

68% of polled banks forecast growth in the corporate loan portfolio  over the next 12 months. 62% of respondents expect consumer lending growth to accelerate. Respondents are optimistic about the deposit growth.

Q2 saw a substantial increase in demand for consumer and mortgage loans. Lower lending rates, higher consumer confidence and a pick-up in the real estate market are seen by the respondents as the main driving the deposit growth.

The demand for corporate loans continued to increase in Q2. This was stated by 45% of the polled banks.  Higher demand, which  was seen for all types of loans, except for FX loans, was driven by the enterprises’ need for working capital, investment, and debt restructuring, as well as lower interest rates.

in Q3 2017, banks expect further growth in demand for loans, especially consumer loans, supported mainly by a decline in interest rates.

Q2 saw an increase in loan application approval rates for both corporate and consumer loans, as compared to the previous quarter. 

 Over the past two years, lending surveys have pointed to easing lending standards for consumer loans reported by banks. Lending standards for mortgage  loans have relaxed for three quarters in a row. Meanwhile, most respondents (72%) reported that lending standards for corporate loans had remained unchanged.

Notes: The Lending Survey (Q3 2017) presents unweighted respondents’ answers, i.e. 1 bank= 1 voice.

For reference

The NBU publishes the Lending Survey Analytical Report quarterly. The report summarizes the results of a survey conducted by the NBU among commercial banks on the state of lending in the reporting quarter, its prospects for the next quarter, and its prospects over the 12 subsequent months.