Financing extended by financial institutions to families and non-profits based in Spain rose by 0.7 percent. In contrast, lending to companies declined by 0.2 percent, totaling 944,018 million euros in June, compared with the same month a year earlier, according to data released this Monday by the Bank of Spain. The report highlights a recognizable uptick in consumer credit alongside a dip in corporate credit within the same period.
The data point to a rise in credit flowing to families, even as references to companies recorded losses of 4.826 million and 1.683 million euros over the last twelve months. This pattern occurs in a period dominated by the effects of the Ukraine conflict on the Spanish economy and ongoing inflationary pressures that are shaping borrowing and spending behavior.
The Bank of Spain stressed that financing to households remained stronger in June 2022 than in the pre-pandemic era, while support for businesses continued to slow to a year-over-year rate approaching zero. In practical terms, consumer borrowing did not shrink as rapidly as corporate credit, signaling a shift in financial priorities among households as economic conditions evolve.
On a monthly basis, family indebtedness rose by 1.4 percent in June, increasing by 9,806 million euros from May. During the same month, corporate debt grew by 1.669 million euros, up 0.2 percent compared with May, illustrating a divergence in the pace of growth between households and firms.
Debt securities are growing
Housing loans, which comprise the largest share of total debt, stood at 517,696 million euros in June. This figure is nearly unchanged from the previous month and shows an increase of 5,357 million euros versus a year ago, aligning with a recent rise in home sales. The Bank of Spain’s data indicate that households still account for the majority of total lending, representing about 72.7 percent of the overall housing-related debt. This concentration underscores the central role of households in Spain’s financing landscape during the observed period.
Consumer loans to families increased by 0.4 percent month over month, reaching 93,159 million euros in June, while the annual interest rate registered a decline of 1.1 percent. Loans for other household purposes totaled 98,197 million euros, compared to 89,037 million in the prior month, marking a 10.3 percent rise after six months of decline. The year-over-year rate, however, edged up by 0.7 percent, signaling a gradual stabilization in consumer credit for non-housing needs.
Debt securities are growing (continued)
From another angle, lending to companies in the first half of the year showed a year-over-year decrease, driven by reductions in both loans from financial institutions and external borrowings. In this context, debt securities have risen in recent periods, signaling a shift toward capital market funding. Specifically, bank loans to companies reached 483,031 million euros in June, down 0.3 percent from the prior year’s June. Debt securities climbed 3.6 percent year-on-year to 138,675 million euros, while loans obtained from abroad fell by 1.4 percent year-on-year to 322,312 million euros. These movements reflect ongoing diversification in corporate financing channels as firms adjust to evolving financial conditions.