Banking barometer: keen demand on loans and growing interest in investing

According to Finance Finland’s recent banking barometer, households asked for more loans than they did last year. Bankers expect the keen demand for loans to continue in the first quarter of 2018, and predict fastest growth for home loans. Businesses also took out more loans than in 2016, especially to make investments.

​Households’ investments continued to be a growing trend, with shares and real estate rising fastest in popularity. People are also ready to take loans to invest, which is only natural especially in housing investments.

“In recent years, households have made a notable amount of housing investments, both directly and through diversified residential funds. In a time of meagre interest yields, housing investments are an attractive option, with a risk level that typically falls somewhere between that of shares and interest-bearing instruments. The increasing popularity of housing investments will probably also be reflected in housing loan numbers”, summarises Elina Salminen, head of statistical and supervisory reporting at Finance Finland.

Businesses take loans to make investments

According to the barometer, businesses also asked for loans more frequently than in 2016. Banks expect the demand for investment loans to grow significantly: in the recent barometer, the number of loan requests was at an all-time high and none of the respondents expected the demand to dwindle.

In its quarterly banking barometer, Finance Finland asks bank managers how they expect loan requests and different investment forms to develop. The 4/2017 barometer was conducted in November–December.

Barometer results in Finnish, 4/2017