The monthly report from the Abi, the slowdown in the economy depresses the demand for loans: -3.8%


By John

The economic slowdown continues to depress the demand for bank loans to families and businesses who are also affected by the ECB’s monetary tightening. As emerges from Abi monthly report in September 2023loans fell by 3.8% compared to a year earlier, while in August 2023 they had recorded a decline of 3.5%, when loans to businesses had decreased by 6.2% and those to families by 0.6 %.

The average rate on new mortgages fell slightly. According to the monthly Abi report in September it was equal to 4.23%, in August it was 4.29%. The average rate on new business financing operations was 5.35%, in August it was 5.01%. The average rate on total loans was 4.55%, in August it was 4.48%.

In September the rate charged on new fixed term deposits it grew to 3.57% from 3.39% in August (+18 basis points). This is what the ABI communicates in the monthly report according to which «in August 2023 this rate in Italy was higher than the average of the euro area (Italy 3.39%; euro area 3.28%)». Compared to June 2022, when the rate was 0.29% (last month before the ECB rate hikes), the increase is 328 basis points. The yield on new fixed rate bond issues in September 2023 is 4.42%, (1.31% in June 2022), an increase of 311 basis points. The average rate on total deposits (certificates of deposit, savings deposits and current accounts) increased to 0.83% from 0.79% in August (0.32% in June 2022). The rate on current account deposits alone grew to 0.44% from 0.41% in August, “bearing in mind that the current account allows you to use a multitude of services and does not have an investment function” reiterates the ABI.