This report presents the results of the 2009 Q4 survey. The 2009 Q4 survey was conducted between 16 November and 4 December. The results are based on lenders’ own responses to the survey.

Supply

• A net balance of lenders reported that they had increased the availability of secured credit to households in the
  three months to early December 2009, driven in part by improvements in the economic outlook. A further slight
  increase in the availability of secured credit was expected over the next three months.
• Unsecured credit availability to households had continued to fall, but was expected to stabilise over the next three
  months.
• A net balance of lenders reported continued improvement in corporate credit availability over the past three
  months, with a further increase expected in 2010 Q1.

Demand

• A further increase in demand for secured lending for house purchase was reported, but demand for secured
  lending for remortgaging had fallen in 2009 Q4. Demand for secured lending for both house purchase and
  remortgaging was expected to be broadly unchanged in 2010 Q1.
• Household demand for unsecured credit had continued to fall over the past three months, though demand was
  expected to rise over the next three months.
• Demand for credit by private non-financial corporations (PNFCs) was weaker than anticipated, driven by reduced
  demand from larger firms. Demand from PNFCs was expected to rise over the next three months.

Defaults

• Lenders reported that default rates on secured lending to households were stable over the past three months,
  while losses given default had fallen unexpectedly. Default rates on secured lending were expected to rise over the
  next quarter.
• Contrary to expectations of a rise, default rates on unsecured lending to households had fallen slightly, with
  further falls anticipated. But losses given default had continued to rise.
• Default rates and losses given default on lending to private non-financial corporations had continued to increase,
  and were expected to rise further.

Terms and conditions

• Spreads on secured lending to households were reported to have stabilised, with a reduction in spreads expected
  over the next three months. There had been some increase in maximum loan to value ratios in 2009 Q4, with
  other non-price terms remaining broadly stable.
• Spreads on unsecured lending to households had risen a little over the past quarter.
• Lenders reported that spreads and fees on corporate lending had reduced slightly over the past three months, with
  further easing of price terms expected over the next quarter. Non-price terms had remained broadly unchanged.

www.bankofengland.co.uk/publications/other/monetary/creditconditions.htm