Risks are building up in the financial sector
Analysis - November 2017 - No. 23
There is a sentiment of optimism in the financial sector. Profits of the credit institutions are rising, and a considerable lending capacity has been built up. This increases credit institutions’ risk appetite, which is reflected in easing of credit standards. Several credit institutions are increasing lending to cyclical industries and to vulnerable households with high debt ratios. At the same time, rising house prices mean that credit growth may take off suddenly.