CNB Council: Growing demand for corporate credit

Published: 8/6/2022

At today’s session, the Council of the Croatian National Bank examined current economic and financial developments and financial stability and adopted CNB’s Annual Report for 2021 and several decisions on matters within its competence.

The growth in real GDP accelerated considerably in the first quarter of 2022, while the available statistical indicators for the beginning of the second quarter suggest a somewhat slower growth than at the start of the year. The growth in employment and nominal wages also slowed down from the beginning of the year.  Consumer price inflation accelerated from 7.3% in March to 9.4% in April, mainly driven by the growing contribution of energy and food with increasing diffusion of price increase by product groups and services. Short-term and long-term costs of government financing continued to rise slightly in May, mirroring developments in the global financial markets. The tightening of the financing conditions has thus far not affected interest rates on loans to households and corporates, which fell slightly in April.

Total placements of monetary institutions to domestic sectors (except the central government) continued to accelerate on an annual level, having risen from 5.0% in March to 6.5% in April, mainly as a result of a sharp increase in placements to non-financial corporations, and to a lesser extent faster growth of household placements. The growth in credit demand of corporates is probably associated with higher costs of imports of energy products and raw materials and corporates’ efforts to borrow way ahead of the expected increase in borrowing costs.

The CNB Council approved the appointment of Emanuela Vukadinović as Member of the Management Board of Istarska kreditna banka Umad d.d.