January 2026 euro area bank lending survey

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3 February 2026 Banks tightened credit standards for firms, citing higher perceived risks amid lower risk tolerance Credit standards eased slightly for housing loans, but tightened further for consumer credit Small increase in demand for loans to firms, while demand for housing loans grew moderately Trade tensions and related uncertainty added to tighter credit standards and dampened loan demand According to the January 2026 bank lending survey (BLS), euro area banks reported an unexpected net tightening of credit standards (banks’ internal guidelines or loan approval criteria) for loans or credit lines to enterprises in the fourth quarter of 2025 (net percentage of banks of 7%; Chart 1). Banks reported a small net easing of credit standards for loans to households for house purchase (net percentage of -2%), whereas credit standards for consumer credit and other lending to households tightened further (net percentage of 6%). For firms, the net tightening in the fourth quarter followed a smaller net tightening of credit standards in the third quarter, surpassing the expectations reported by banks in the previous survey round (1%). Concerns about the outlook for firms and the broader economy, as well as banks’ lower risk tolerance, contributed to tighter credit standards. Banks indicated a small net easing of credit standards for housing loans, which they had not expected, and a further net tightening of credit standards for consumer credit, which was above the expectations they had reported in the prior quarter. For housing loans, competition had an easing impact on credit standards, while risk perceptions had a tightening impact. Banks’ lower risk tolerance and higher risk perceptions were the main drivers of the tightening for consumer credit. For the first quarter of 2026, banks expect a moderate further net tightening of credit standards for firms, a slight tightening for housing loans and a more marked tightening for consumer credit. Banks’ overall terms and conditions (the actual terms and conditions agreed in loan contracts) tightened for loans to firms and consumer credit, while they eased for housing loans. Banks reported a net increase in the share of rejected loan applications for firms and consumer credit, while the share remained unchanged, in net terms, for housing loans. The net increase in share was higher than in the previous quarter for firms, but lower for households. In the fourth quarter of 2025, banks reported a continued small net increase in demand for loans or credit lines to firms (net percentage of 3%; Chart 2). This followed a similar net increase in loan demand in the previous quarter and exceeded the expectations reported by banks in that quarter (0%). Firms’ loan demand was primarily driven by an increase in demand for inventories and working capital and other financing needs, whereas fixed investment continued to make an overall neutral net contribution. Demand for housing loans continued to increase in net terms (net percentage of 9%), albeit more moderately, broadly in line with banks’ expectations in the previous quarter. Improved housing market prospects were the main driver of the increase in housing loan demand, while consumer confidence contributed negatively. Demand for consumer credit and other lending to households declined slightly (net percentage of -2%), following broadly unchanged demand in the third quarter and being somewhat lower than what banks had expected in the previous quarter. Lower consumer confidence dragged consumer credit demand down despite the continuing positive contribution from the level of interest rates. In the first quarter of 2026, banks expect a net increase in loan demand from firms and households. Banks’ access to retail funding and money markets deteriorated slightly in the fourth quarter of 2025, while it eased for debt securities and securitisations. Over the next three months, banks expect access to funding to remain broadly unchanged, except for a sligh

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