Total lending by commercial banks at the end of August 2020 was 271.2 billion kuna, a drop for the third consecutive month, of 0.1%, but compared to August 2019 this was an increase of 7%, shows the latest data from the Croatian National Bank (HNB).

Total bank lending at the end of August was HRK 61 million down from July, while compared to August 2019 it was up by 17.8 billion.

Compared to the end of last year, total lending by commercial banks, including lending to the central government, local government, the business sector, households, other financial mediators, insurance companies and pension and investment funds, not including money market funds, grew by HRK 10.9 billion or 4.2%, Raiffeisenbank (RBA) analysts said in a comment on the HNB data.

Kuna loans, which have been recording positive trends for slightly more than seven years, grew in August by HRK 16 billion or 14.5% year-on-year. Loans tied to a foreign currency, whose share in total loans has been decreasing steadily since the second half of 2012, accounted for 53.1% of all loans at the end of August, a year-on-year increase of HRK 1.7 billion or 1.2%.

The analysts also note that roughly half of all loans were loans to households, totalling HRK 135.2 billion, a monthly increase of HRK 196.4 million or 0.1% and an annual increase of HRK 5.1 billion or 3.9%.

General-purpose cash loans grew by 6.6% on the year albeit at a slower rate while housing loans totalled HRK 60.2 billion, an increase of 9.1% compared to August 2019. Due to increased market activity, the share of housing loans in total household loans grew from 42.4% to 44.5% while the share of kuna housing loans grew from 29.9% to 31.4%.

Lending to the business sector, not including financial institutions, totalled HRK 84.8 billion at the end of August, a monthly drop of HRK 749.2 million or 0.9%. Year-on-year, they grew by HRK 2.9 billion or 3.7%.

Loans to the central government totalled HRK 42.9 billion, HRK 62.4 million or 0.1% more than in July while on the year they grew relatively strongly, by HRK 9.9 billion or 30.1%, “which is an expected trend in the current time of crisis,” the RBA analysts said.