New figures show that European banks are lending less to companies — another sign the continent’s economic upswing remains less than robust.
The European Central Bank reported Friday that loans to companies slipped by 3.1 percent in November from a year earlier. The drop was sharper than the previous month’s 3.0 percent.
Analysts say banks can be reluctant to lend given uncertain growth prospects that mean increased risk they won’t be repaid. Some companies, meanwhile, may not want to risk borrowing. Others don’t need credit because they are sitting on adequate cash reserves — but don’t yet see a reason to invest that cash in new production.