Banks tightened conditions for business loans, mortgages

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Banks in the Netherlands tightened their acceptance criteria for applications for both business loans and residential mortgages, Dutch central bank DNB reported based on an international study. The Dutch banks expect that conditions will become even stricter in the coming months.

The researchers surveyed banks about the flexibility of their lending. Most of the Dutch banks said they've become stricter in the second quarter, after relaxing conditions over the past years. This is partly due to higher risks related to the negative economic consequences of the coronavirus and the measures taken against its spread. The economic consequences of the pandemic will increase the overall risks or banks in the longer term, which means that banks will likely further tighten their conditions for lending in the coming months. 

According to DNB, this clear tightening of acceptance criteria is not present in other euro countries. In Germany, for example, only a small number of banks implemented stricter conditions. Banks in France, Spain, and Italy said they've relaxed their lending criteria.