SME lending market grew rapidly even during pandemic

Banking

Since 2019, the stock of loans to small and medium-sized enterprises in Hungary has continued to grow dynamically, despite the economic challenges posed by the coronavirus pandemic, according to a press release sent to the Budapest Business Journal.

The stock of loans to SMEs in Hungary has increased significantly compared to the last year before the coronavirus pandemic, according to data by the National Bank of Hungary (MNB).

CIB Bank also saw a steady increase in its SME loan portfolio in 2020-2021, and the bank's corporate portfolio grew by more than 30%, outperforming the market.

The bank's data also shows that the coronavirus epidemic has not significantly altered the composition of the portfolio, with three sectors - manufacturing, trade and agriculture - accounting for nearly two-thirds of SME lending, with the first two being the more dominant, and with automotive and M&A transactions remaining CIB Bank's focus.

Small and medium-sized enterprises in the construction sector have also normally accounted for a significant slice of the portfolio - roughly one-tenth - between 2019 and 2021.

"Our data clearly shows that CIB Bank's focus has not changed in recent years: the dominance of these three large sectors and the relatively significant weight of construction in our portfolio also shows that we continue to finance the real economy," said Tamás Győr, director of CIB Bank's SME business line. He added that the bank's stock of loans to SMEs in the manufacturing sector has increased by nearly 40% in the past two years, which is more than 10 percentage points above the market average.

CIB Bank's data also shows that there are some sectors that have seen larger swings in credit growth since the end of 2019, one of which is information and communications. 

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