In January and February, the volume of new housing loans added up as much as in full years of the troika in Portugal.
Photo by Diogo Palhais on Unsplash
Photo by Diogo Palhais on Unsplash

The global coronavirus pandemic is affecting everyone and everything in one way or another. The authorities anticipate a year of global economic recession, which contrasts with the time before the outbreak of this global health crisis. In Portugal, for example, in the first two months of the year, the bank lent nearly 2 billion euros for property purchases - almost the same as in past years such as 2012 or 2013, when the troika was in the country. 

In February, without yet reflecting the effects of the COVID-19 outbreak in Portugal, the value of the new home loans generated in the country fell in comparison to January, but well above other times of crisis. New mortgage operations reached 919 million euros in the second month of the year, according to data from the Bank of Portugal (Banco de Portugal), revealed on Tuesday 14th April, 2020. In January, loans had been granted for the purchase of homes worth 977 million euros. 

Taking into account the first two months of the year, new mortgages for this purpose amounted to over 1.8 billion euros, corresponding to the fastest start-up year since 2008. However, what is now necessary is to know the figures for March, the month in which the state of emergency in Portugal was decreed and confinement measures were implemented.

Consumer credit and rising business

In total, banks financed 1.636 billion euros to households in February, slightly less than the 1.652 billion lent in January. And, unlike housing credit, which decelerated in comparison to January, new consumer credit operations increased, as the most recent indicators released by the Bank of Portugal show. In February, 469 million euros were lent to individuals within this area, up from 460 million euros in the first month of the year. Loans for other purposes increased from 215 to 248 million euros.

Loans to companies grew in February. According to BPStat figures, new credit operations directed at non-financial companies reached 2.743 billion euros, a figure that compares with 2.571 billion euros in January and 2.258 billion lent in the same period.

Financing operations in excess of 1 million euros exceeded 1.287 billion euros, compared to the 1.047 billion granted at the start of the year. New financing for smaller companies, less than one million euros, stood at practically the same level as one month earlier: 1.457 billion euros, compared with 1.497 billion in January.