Euro area banks tighten credit standards for firms further, ECB survey shows

Euro area banks further tightened credit standards for loans to companies in the third quarter of 2026, with a net 9% of banks reporting tighter standards, the European Central Bank said Oct. 27, 2026, in its quarterly bank lending survey.

The tightening for firms exceeded the 5% banks had expected in the previous survey round, the ECB said, citing heightened risk perceptions and banks’ reduced risk tolerance as the main drivers. A net 14% of banks reported tighter standards for consumer credit, while standards for housing loans were unchanged.

Demand for loans fell across all segments, mainly because of higher interest rates, according to the survey. A net 6% of banks reported lower demand from companies and a net 27% reported lower demand for housing loans, while demand for consumer credit fell slightly.

For the fourth quarter, banks expect credit standards to tighten further for firms and to tighten significantly for housing loans and consumer credit, the ECB said. Asked about the impact of artificial intelligence on demand, several banks said they expect a gradual but sustained increase in demand for loans to finance digital infrastructure, particularly data centers.

The October survey was conducted between Sept. 21 and Oct. 6, 2026, among 159 banks, with a response rate of 100%, the ECB said.