Credit Conditions of Austrian Companies

In August 2023, the credit hurdle – defined as the balance of the share of companies that describe bank lending as accommodating (positive values) and the share of companies that describe bank lending as restrictive (negative values) – deteriorated further compared to the previous quarter (–3.3 points) and was deep in negative territory at –24.1 points. The assessments by company size continue to show clear differences: the credit hurdle is higher for smaller companies (up to 50 employees) (–26.2 points) than for medium-sized companies (50 to 250 employees: –21.0 points) and larger companies (more than 250 employees: –15.8 points).
The survey results show a slight increase in the demand for credit (+0.7 percentage points compared to the previous quarter), which in the aggregate (excluding retail trade) is in the range of the long-term average (20.8%) with a value of 21.0%. In the construction industry, 20.8% of companies reported a need for credit, in manufacturing 20.7%, in services 21.1% and in retail 15.8%. By company size (excluding retail), 20.4% of smaller companies (up to 50 employees) recently reported a need for credit, 23.0% of medium-sized companies and 23.4% of larger companies (more than 250 employees).
Of the enterprises with credit needs (excluding retail), around 51.7% had to make concessions in terms of amount or conditions (38.0% reported worse conditions, 4.8% lower amount and 8.8% worse conditions and lower amount than expected). This value is far above the average of the past years (18.4%). Only about 17.5% of the companies with credit needs were able to obtain it as expected (5-year average: 62%). Above average, at 32.7%, was the share of those enterprises with credit needs that did not obtain a loan or had not applied for one (5-year average: 19.6%; about 6.9% of all surveyed enterprises) because the loan application was rejected by the bank (5.6%), the conditions were not acceptable (16.9%) or they had not attempted to obtain a loan due to lack of opportunities (10.2%).