There is no doubt that banks and credit unions are in a difficult position due to the repercussions of the coronavirus pandemic. This is confirmed by the latest data published by the Credit Information Bureau (BIK).
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In September 2020, banks and SKOK granted much less loans compared to the same period of 2019. The banks admitted in numerical terms:
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21.6 percent fewer credit cards,
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5.1 percent less mortgage loans.
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The only positive accent in the BIK newsletter is the increase in the number of installment loans – there were 7.1 percent. more than in September last year.
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They get high salaries, but the price they pay themselves is also high
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The situation on the credit market in our country looks no better when it comes to the year-on-year valuation. Banks and credit unions granted in this respect:
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· 20.8 percent fewer limits on credit cards,
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22.8 percent less cash loans,
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Again, the positive dynamics concerned only installment loans – the increase in value in this loan category was significant and amounted to 17.2%.
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BIK summarized the current results of banks and credit unions in terms of lending. He calculated that during the three quarters of 2020, lending institutions granted 2.068 million cash loans for the amount of PLN 38.577 billion. It was over 30 percent. less in terms of numbers and 31.8 percent. less in terms of value compared to the same period of 2019. Banks and SKOK credit unions granted a total of 2.491 million, i.e. 1.4 percent. more than last year in the first 9 months. Installment loan agreements totaled PLN 10.745 billion – 0.8 percent. more than a year ago.
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Declines in housing loans granted in the reported period are clearly visible, both in terms of numbers and value. The total number of signed contracts was 160.1 thousand. and was over 11 percent. lower than in the corresponding period of 2019, in terms of amounts it was lower by 5.4%. and amounted to PLN 46.166 billion.
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Is there a chance for a trend reversal?
Financial market experts have no doubts that the pandemic has introduced serious changes that were severe for banks and credit unions. It will be difficult to reverse them and make Poles want to take out more and more bank loans. The more so because the pandemic is in full swing, and many people have only recently returned to repay the full amount of the principal and interest installment. Previously, they used the 3-month credit holidays offered by banks to support people in financial difficulties as a result of the coronavirus epidemic.
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Did you throw away the chair from the PRL? It was worth the national average
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The information provided by BIK about the declining interest in housing loans is not yet the result of granting this type of commitment in September. Usually, mortgage loan agreements signed just this month result from loan applications submitted in July and August.
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In the case of cash loans and installments, customer applications are properly processed on an ongoing basis, therefore these data are consistent with the actual state of affairs. The highest decrease concerned high-value loans, i.e. those granted for an amount exceeding PLN 50,000. PLN. This may be due to a much more cautious approach by banks to granting potentially risky loans, which could cause greater damage if they are not repaid by lending institutions. At the same time, the number of consolidations is falling – about 44 percent. of newly granted cash loans results from their rolling, consolidation or renewal, while in 2019 it was 48 percent.
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The development of installment loans, integral with installment sales, may be a hope for banking institutions. This is the only group of credit products for which BIK records positive dynamics. They are much safer compared to, for example, cash loans. The customer can buy electronics, furniture or even cars in installments via the Internet or stationary, and sometimes take advantage of offers that are interest-free.
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The negative dynamics is clearly noticeable in the category of credit card limits, which are among the most risky credit products. Banks are cautious about granting them.
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Job. From Tuesday, offices in Poland only work remotely. For two weeks now.
What’s next for mortgage loans?
In the face of the risk of another lockdown in Poland and the specter of losing jobs by thousands of people, many clients put off their housing plans for an unspecified future. This is one of the reasons why banks and credit unions recorded negative dynamics of the value and number of granted liabilities in September this year.
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On the other hand, high-value mortgage loans are selling better and better. The BIK ranking shows that almost half of all loans granted at that time concerned the amount range above 350,000. PLN. The decision to take out a mortgage right now may be dictated by banks loosening the requirements, including in terms of own contribution.
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September’s Demand Index reading positive 5.4%. shows optimism regarding the willingness to take out housing loans in the near future. This is the first positive reading since February, i.e. in the entire pandemic period in Poland to date.
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October is likely to bring further restrictions on the granting of commitments. Mortgage rankings are yet to respond to the second wave of the pandemic. Under the conditions of growing uncertainty, potential bank customers may postpone their loan application and institutions may tighten their lending policies. However, they will most likely continue to invest in online cash loans granted without the need for personal contact with the customer.
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2h ago
LoloOne important information is missing – write what the interest rate on these loans is! You take a cash loan of 10,000 for 2 years and you have to give back 16,000 … Read the whole thing
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