Banks made it harder for firms to borrow in the third quarter and expect to toughen loan requirements further in the months ahead even though their own funding constraints have eased, the European Central Bank said on Wednesday.
In its latest quarterly Bank Lending Survey, the ECB said that banks reported an improvement in their access to retail and wholesale funding across all funding categories in the third quarter.
"Compared with the previous quarter, the impact of the sovereign debt crisis on banks' credit standards receded somewhat in the third quarter of 2012."
"For the fourth quarter of 2012, banks expect funding conditions to keep improving," it said.
The ECB said that a net 15 percent of the euro zone banks that took part in the survey tightened their criteria firms to borrow in the third quarter, up from 10 percent in the second quarter.
The survey, which was conducted between September 20 and October 9, added that banks expect to see demand from firms, consumers and house buyers to continue to weaken in the fourth quarter and they believe they will continue to tighten their lending rules.
The survey of 131 banks was conducted from September 20 to October 9.
For a copy of the survey, click on: http://www.ecb.int/stats/money/surveys/lend/html/index.en.html
(Reporting by Sakari Suoninen)