Sharp fall in lending to firms and households
A surge in medium term business borrowing of up to five years is not enough to offset the overall decline in credit to companies and households here, according to new Central Bank data.
Lending to non-financial corporations saw a year-on-year decline of 6.9pc in July, following an annual decrease of 7.6pc in June.
This resulted from annual declines for the up to one year and over five year loan categories, of 15.1pc and 9.5pc respectively.
But by contrast, medium term loans of one to five-year duration, which accounted for the smallest share of loans, continued to grow strongly, recording an annual increase of 14.4pc. Meanwhile, households continue to prioritise paying down debt, rather than taking out new loans. That's a trend that has been around for some time now.
Household loan repayments exceeded drawdowns by €346m during July.
Mortgages, which account for the vast majority of loans, declined by 2.8pc year-on-year.
Lending for general spending and other purposes fell by 3.5pc year-on-year. In the case of mortgages, repayments exceeded drawdowns by €2.1bn over the year. Repayments also exceeded drawdowns by €640m for non-home loans over the same period.