Europe and its banks are trapped in a vicious circle of low growth, low lending and low rates, claims Standard & Poor’s (S&P).
The credit ratings agency (CRA) bases the assertion on European Central Bank (ECB) data compiled by S&P Global Market Intelligence.
The figures show that there has been little change in the size and structure of European Union (EU) lending since April 2011, with total lending as of April 2016 sitting at €23.75 trillion, just a fraction higher than the €23.55 trillion recorded five years earlier.
Loans to non-financial corporations fell over the period to €5.3 trillion from €5.8 trillion, reflecting a muted outlook for business development.
By contrast with the overall picture, individual country lending has been quite volatile, says S&P. In the five years to April 2016, Spain experienced significant deleveraging following the end of its property bubble, with lending contracting by 27%. Lending was virtually flat in Germany and Italy, while France saw 8.9% and the UK 4.2% growth.
Central banks, in particular the ECB, are striving to pick up the slack through low rates and nonstandard measures such as quantitative easing. These have been particularly controversial in Germany, but have been strongly defended by ECB president Mario Draghi.
However, a London summit on the industry’s introduction of the technology cautions that testing and acceptance are still at an early stage and firms should proceed with caution.
The proposals of both US presidential candidates could shake up operating conditions in several sectors, reports the credit ratings agency.
The Danish shipping and oil conglomerate confirmed that it will separate its businesses into stand-alone transport and energy divisions.
The central bank has tweaked its stimulus programme and is making a fresh effort to push Japan’s inflation rate above its 2% target.