Eurozone loan growth picks up in December

FRANKFURT AM MAIN, Jan 28 (AFP): Lending to the private sector in the eurozone picked up pace in December, official data showed Monday, suggesting little effect from the withdrawal of a key pillar of central bank stimulus last month.

Borrowing among eurozone firms and households grew 3.4 per cent year-on-year in December, European Central Bank figures showed after adjusting for some purely financial transactions.

The pace of growth added 0.1 per centage point compared with November.

Looking in more detail at the data, loans to both households and non-financial firms grew as quickly in December as the previous month, at 3.3 and 4.0 per cent.

But growth in credit to insurance companies and pension funds jumped more than 10 per centage points, to 18.4 per cent.

The figures suggested little impact on the real economy last month as the European Central Bank finally wound down mass purchases of government and corporate bonds, known as "quantitative easing".

Over more than three years the Frankfurt institution bought more than 2.6 trillion euros ($3.0 trillion) of government and corporate bonds, aiming to pump cash through the financial system to stoke growth and inflation.