Credit extended to the private sector slowed to 2% at the end of August 2021 from a growth of 3% at the end of July 2021, a decline attributed to a decrease in demand for credit by businesses.
“The decline in PSCE growth is explained by a decrease in demand for credit by businesses particularly in the short-term lending space. Growth in PSCE remained subdued aided by low domestic economic activities as borrower’s appetite for credit remains low,” the latest figures from the central bank show.
Credit extended to businesses contracted to 1.2% in August 2021, compared to a growth of 2% a month ago.
“The decrease reflects a lower demand and repayments in other loans and advances and overdraft credit by corporates in the commercial services sectors during the period under review.”
Credit extended to households rose 4.4% at the end of August 2021.
“The increase was reflected across all the categories but more specifically in other loans and advances and instalment and leasing sales credit, during the period under review.”
Growth in overdraft credit contracted to 0.1% at the end of August 2021 from a growth of 9% at the end of the preceding month.
“The decrease was driven by repayments and a lower demand from corporates specifically businesses in the commercial services sectors during the period under review.”
The annual growth in mortgage credit rose to 3.6% during the period under review from 2.9% at the end of July 2021.
“The uptick in mortgage credit growth was reflected by a rising demand from both the household and the corporate sectors during the period under review.”
