MNB: Five years may be needed to bring corporate lending back to trend level

MNB

Image by Jessica Fejos

It could take "at least five years" to bring corporate lending stock back to levels close to the long-term trend, even if loan growth reaches an annual 6-7%, the rate required to support sustainable economic development, the National Bank of Hungary (MNB) said in a report on Monday, according to state news agency MTI. 

(Photo: Jessica Fejos)

The central bank noted that corporate lending stock, as a percentage of GDP, had fallen since 2009, creating a "gap" between actual borrowing levels and the desired equilibrium. A return to the long-term trend could be achieved in a shorter period, a "minimum three years", if lending growth in the SME segment reaches 10%, which the MNB said was "justified" as these businesses had been hit harder by the credit crunch.

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