Based on the 2015 Q1 data, corporate lending is still characterised by a fragile recovery. Total corporate loans outstanding increased by 0.6 per cent year-on-year, while in the SME sector the lending dynamics continued to intensify and loans outstanding rose by 3.3. per cent. Within the framework of the second phase of the Funding for Growth Scheme (FGS) contracts in the value of HUF 76 billion were signed during the quarter, which is higher in year-on-year terms. The FGS substantially contributed to the favorable developements in corporate lending, even though the first quarter characteristic seasonal decline in corporate credit was observable here as well. In parallel with this, the Monetary Council decided to launch the FGS+ targeting riskier SMEs. Based on the banks' answers to the lending survey, corporate credit conditions have eased, and demand for long-term loans increased in Q1. The funding costs of forint loans dropped nearby the level of euro loans, especially in the case of high-amount loans, while average cost of domestic corporate loans was favourable even in an international comparison.
The settlement and conversion of foreign currency loans considerably reduced household indebtedness and simultaneously also changed the structure thereof: the ratio of foreign currency loans within total household loans fell below 5 per cent. The volume of newly disbursed household loans increased in year-on-year terms. The debt cap regulation with its entry into force in January does not slow down healthy household lending according to the available data, while strengthens financial stability and prudent banking operations. Based on the answers of the respondent banks to the lending survey, terms and conditions for housing loans were constant in Q1, while those for consumer loans tightened. Looking ahead, however, the banks indicated easing conditions in both segments. Furthermore, based on the survey, the banks reported a slight increase in demand for housing loans and a decline in demand for consumer loans, however, in the next two quarters they anticipate growth in both segments. On the whole, the total annual percentage rate of charge on actual loans continued its declining trend in case of the main product types in parallel with the decrease of the base rate, and considering the extent of this easing, this also resulted in a decrease in spreads over the reference interest rate.