Bloomberg News

Danish Banks Tighten Credit Standards as Loan Losses Set to Rise

October 10, 2011

Oct. 10 (Bloomberg) -- Danish banks tightened credit standards in the third quarter as writedowns rose and lenders forecast more losses by the end of the year, the central bank said.

Banks tightened standards for corporate lending, including raising prices, as writedowns and losses by small- and medium- sized enterprises rose, the central bank said in its quarterly survey published on today.

Mortgage and commercial banks also tightened credit standards for consumers to reflect growing risk and the lenders’ own higher funding costs, the central bank said. The tightening took the form of lending fees, it said. Household demand for loans fell, while corporate borrowing was largely unchanged, the bank said.

--Editor: Tasneem Brogger, Jonas Bergman.

To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at fschwartzko1@bloomberg.net

To contact the editors responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net; Angela Cullen at acullen8@bloomberg.net


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