European lending contraction slowed in November

European statistics point to a moderation in credit contraction.

European Central Bank statistics show that a contraction in lending to the private sector slowed in November 2014. Credit extended to the private sector shrank by 1.4 percent, marginally down from a 1.6 percent decline in October. The central bank released the data on 30 December.

Negative eurozone lending growth has dogged the area as traditional banks have pulled back from lending and cut the size of their balance sheets, opening up opportunities for alternative lenders.

Of the debt statistics, credit extended to general government was almost the only item that reported positive growth with annualised average growth of 0.9 percent.

Loans to the private sector fell 0.9 percent, down from a negative rate of -1.1 percent in October. For non-financial corporations, the contraction in lending fell to -1.6 percent, versus -1.8 percent in October.

The annual growth rate of loans to non-monetary financial intermediaries (excluding insurance corporations and pension funds) fell to -1.5 percent in November, a full percentage point up from the -2.5 percent recorded in October.