Euro-Zone Banks Tightened Credit Standards on Economic Risks (2)

Banks in the euro area tightened credit standards for firms at the start of the year as dangers to the region’s economy increased, the European Central Bank said.

The move “was again driven by higher perceived risks related to the economic outlook and to the industry and firm-specific situations,” the ECB said Tuesday in its quarterly Bank Lending Survey.

At the same time, demand among companies for loans fell slightly following two quarters of recovery — mainly due to “a negative contribution from firms’ inventories and working capital and despite the support from declining interest rates.”

Trends in lending ...