Greek consumers: Demand for mortgages slows, stable for consumer loans – What do the figures of the Bank of Greece show

The demand for housing loans decreased, while it remained almost unchanged for consumer loans, during the third quarter of 2023, according to the Bank of Greece Bank Loans Survey.

The overall conditions for granting business loans remained unchanged, as did the overall demand for business loans, while the criteria for granting loans to non-financial enterprises (NFEs) also remained stable.

Loans to non-financial businesses

In the third quarter of 2023, lending criteria to non-financial corporations (NFCs) remained almost unchanged compared to the second quarter of 2023 (see Chart 1), a development in line with expectations expressed in the survey of previous quarter. In addition, the banks estimate that the criteria will remain unchanged during the fourth quarter of 2023.

The overall terms of loans to SMEs remained almost unchanged compared to the second quarter of 2023, although the banks’ interest margin for conventional loans decreased to a point.

During the third quarter of 2023, the total demand for loans to SMEs  remained unchanged. In the next quarter, overall loan demand is expected to remain almost unchanged, although small and medium-sized business loan demand is expected to increase to some extent.

The proportion of business loan applications rejected was unchanged from the previous quarter.

Loans to households

During the third quarter of 2023, the criteria for granting loans to households remained unchanged compared to the second quarter of 2023 (see Chart 1), a development in line with the expectations expressed in the survey of the previous quarter. The overall terms of lending to households also remained unchanged.

Demand for housing loans decreased, due to the end of the subsidized housing program “My Home”, while demand for consumer loans remained almost unchanged (see Chart 2). For the fourth quarter of 2023, the demand for housing loans is expected to remain unchanged, while for consumer loans it is expected to increase.

The criteria for granting housing and consumer loans are expected to remain unchanged during the fourth quarter of 2023.

In the third quarter of 2023, the proportion of mortgage applications rejected was almost unchanged, while the corresponding proportion for consumer loans was unchanged, compared to the previous quarter