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Serbia, Demand for loans was reduced in the first quarter of this year

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The economy reduced the demand for loans in the first quarter of this year, according to domestic bankers in the Bank Credit Activity Survey, published by the National Bank of Serbia (NBS).

The demand, first of all, for long-term loans, mostly among small and medium-sized enterprises for bank loans, has decreased.

Large companies, on the other hand, slightly increased their demand for loans, according to the NBS Report.

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Bankers estimated that the decrease in demand for loans was influenced by the weakening of investment activity, as well as a lower number of mergers or acquisitions of other companies during the first quarter.
Banks expect a recovery in demand for business loans during the second quarter, which is likely to reverse the decline from the first three months of this year, the report added.

The results of the survey also show that the banks tightened the conditions under which they granted loans to the economy in the first quarter, which was, however, milder compared to the tightening in the fourth quarter of last year.

The co”ditio”s were also tightened for dinar and foreign currency loans, which were most common among large companies.

The tightening of credit conditions for the economy was primarily influenced by the increased costs of financing sources (the effect of the tightening of the monetary policy of the National Bank of Serbia and the European Central Bank).

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Certain banks stated in the Survey that problematic claims, the quality of required collateral, uncertainty regarding the general economic situation, as well as the reduction of competition in the banking sector due to bank mergers contributed to the tightening of conditions.

Since the beginning of 2014, the National Bank of Serbia has been conducting a survey on the credit activity of banks.

Given that banks’ participation in the survey is voluntary, the data are reliable thanks to the response of almost all banks, according to the NBS Report.


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