www.ecb.europa.eu
4 July 2023
- Credit terms and conditions tightened for all types of counterparty between March and May 2023
- Resources and attention dedicated to managing concentrated credit exposures to banks and dealers increased
- With the exception of domestic government bonds, financing rates/spreads increased for funding secured against all types of collateral
Overall credit terms and conditions in the securities financing and OTC derivatives markets tightened for all types of counterparty between March and May 2023. This was a continuation of the developments observed over the previous eight quarters and was in line with the expectations expressed in the March 2023 survey. The tightening of credit terms and conditions was most pronounced for banks and dealers and insurance companies. Survey respondents mainly attributed this tightening to a deterioration in general market liquidity and functioning – and, to a lesser extent, concerns about an expected deterioration in the financial strength of…