Household and corporate credit demand was broadly unchanged in 2025 Q4. Banks expect approximately unchanged household and corporate demand in 2026 Q1. As in Q3, banks report slightly stronger competition in both segments and slightly tighter household and corporate lending spreads. For the corporate segment, banks expect a corresponding strengthening of competition and for lending spreads to tighten slightly further in 2026 Q1.

Households

Overall, banks report that residential mortgage demand was approximately unchanged in 2025 Q4 (Chart 1). Demand fell slightly for fixed-rate loans but was broadly unchanged for first-home mortgages. Banks expect approximately unchanged demand in 2026 Q1 (Chart 2).

Credit standards for households were broadly unchanged in 2025 Q4, and banks expect no change in 2026 Q1 (Chart 1).

Chart 1 Residential mortgage demand, credit standards and lending spreads

Chart 2 Household residential mortgage demand

Overall, banks report that residential mortgage lending rates fell somewhat in 2025 Q4 and lending spreads tightened slightly. Banks expect almost no change in 2026 Q1 (Chart 3). Funding costs for residential mortgages also fell slightly, and banks report slightly stronger competition. Banks expect funding costs and competition for residential mortgages to remain broadly unchanged in 2026 Q1.

Chart 3 Banks’ operating environment, lending spreads and lending rates. Residential mortgage loans

Corporates

For non-financial corporates, banks as a whole report approximately unchanged demand in 2025 Q4 and also expect no change in 2026 Q1 (Chart 4). Credit line utilisation was broadly unchanged, in line with demand for fixed-rate and commercial real estate loans. Banks expect almost no change in 2026 Q1. On the whole, banks report broadly unchanged credit standards in Q4 and expect credit standards to also remain unchanged in 2026 Q1. Furthermore, some banks report that they are being cautious when lending to construction projects.

Chart 4 Credit demand, credit standards and lending spreads. Lending to non - financial corporates

Banks report that corporate lending spreads fell slightly in Q4, and they expect lending spreads to fall slightly further in 2026 Q1 (Chart 5). Banks' funding costs and lending rates to non-financial corporates were broadly unchanged in Q4, and almost no change is expected in 2026 Q1.  Furthermore, banks report slightly stronger competition for corporate loans in Q4, and they expect this to continue in 2026 Q1.

Chart 5 Banks’ operating environment, lending rates and lending spreads. Lending to non - financial corporates