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Swedish companies start borrowing again but are the banks lending?



  

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Wednesday, 04 May 2011
In recent years, Swedish households borrowed considerably more at the expense of Companies and businesses. But now it appears the trend would flip to the other way, as signs that companies are beginning to borrow more again star emerging.

SEB CEO Annika Falkengren said that signals from the country’s companies are more positive now, even if they are still cautious.
“They look a bit brighter on life but they are still a bit quiet. I think everyone knows that they want to be a bit careful.” She said to radio Sweden.

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The word conservative is also very consistent with the data from Statistics Sweden, SCB, published recently which show that in March, lending to businesses grew by three percent in Sweden more than in February when the increase was less than two percent.

And now the trajectory is pointing of corporate borrowing which shows a clear leap to that direction, something the banker in Nordea, Annika Winsth say is good for Sweden's economy.

“It is of course very important. One has survived the crisis, it takes a while before one want to invest and hire. And now we see that companies don’t only want to hire but also have the desire to borrow money to make investments. This is a positive economic signal.”

During late 2009 and during much of 2010 there was reduced lending to firms for as month passed, by over five percent per month. This happened despite the fact that the repo rate was at a record low.

“Historically, a relatively low level but we should remember what period we are coming from. The important thing is that it will start now, "said Annika Winsth

As the big banks recently submitted their quarterly reports, many issues they touched were increased lending to companies. It has been seen an impatient issue with bank managers over time have made such promises to increase the number of loans made available but the actual lending is not growing as expected.

“We have loaned more than Skr6 billion to small and medium sized companies in this quarter. So we see that there is a lending need. It is clear that it would be funnier if it was even bigger but we have seen signs that companies are borrowing and they are active, "said Annika Falkengren.
By Scancomark.se Team


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