“Based on the size of the business, lending standards for small and medium sized businesses have been relaxed to a certain extent, while these standards have remained unchanged for large businesses. For individuals, criteria have only been relaxed for consumer loans, while criteria for mortgage loans remained the same”, bank experts explain on such phenomenon.
Meanwhile, they also say that “the main factors that had an impact in the relaxation of the criteria applying to loans issued by banks relate to the competition in the banking sector and banks’ liquidity level”. Meanwhile, these indicators and the banks’ capital adequacy ratio were perceived as factors that relaxed loan standards for individuals. “The factors which made loan criteria more stringent continue to be non-performing loans, macroeconomic situation and specific problems of the sector”, the Bank of Albania also says.