Firms report more restrictive loan policies of banks

For nearly six years the Ifo Institute has asked its monthly business survey participants for their appraisals of bank lending policies. Initially this question was posed twice a year. Due to the current financial market crisis and the important role of credit financing for the economy, the question on credit conditions has been posed monthly since November 2008 and the results published as the "Ifo Credit Constraints". Since late summer 2008 the lending behaviour of the banks has changed clearly, according to the assessments of the surveyed firms: The access to credit has become considerably more difficult. The share of firms that report an accommodating loan policy has been reduced by nearly half, from 9 to 4.7 percent. The percentage of firms that have appraised the lending policies more unfavourably has increased from 28.7 to 42 percent.