Lacklustre demand behind euro zone loan slump-ECB's Constancio
FRANKFURT Dec 11 (Reuters) - About two-thirds of the weakness in bank lending in the euro zone is due to lack of demand from firms and households, European Central Bank Vice-President Vitor Constancio said on Wednesday.
Falling lending volumes despite record low interest rates has frustrated the ECB, and its President, Mario Draghi, last week hit out at banks for not using enough of its cheap money to help the real economy.
But speaking at an event at Frankfurt's Goethe University, Vice-President Constancio said it was not all the banks' fault.
"We reached the conclusion that two-thirds more or less, comes from demand and some impact from credit supply restrictions."
While banks are naturally cautious during recessions, Constancio added that the upcoming ECB analysis on the health of banks' balance sheets could also have a short-term impact on credit. (Reporting by Sakari Suoninen and Andreas Framke; editing by Marc Jones in London)
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