BoE Credit Conditions Survey

What is BoE Credit Conditions Survey?

The BoE Credit Conditions Survey is a quarterly qualitative survey of UK lenders. The Bank of England runs it as an input to monetary and financial stability work. It covers all lending to UK resident households and corporates through 4 questionnaires. Each questionnaire has its own sample drawn by market share.

Running since 2007 Q2, the original design covered around 30 lenders with 75 percent to 85 percent of lending in each market. Lenders with 1 percent or more of a market are invited to that questionnaire. Participation is voluntary and responses are not verified against other returns. Results reflect lenders' own reports, not Bank views, and the survey excludes realised loan volumes and interest rate levels.

When is it released and what happens each release?

Fieldwork runs 4 times per year in March, June, September and December. Questionnaires go out on the penultimate Monday of the previous month, and lenders have about 1 month to reply. Lenders compare the past 3 months with the prior 3 months. They also give expected change for the next 3 months against the latest 3 months.

Reports appear on the Bank website in January, April, July and October editions. Each report announces the next publication date. Each release brings a report with charts and commentary, a full Excel annex, the questionnaires and the Compilation Guide. The Bank may add ad hoc questions in any round.

Late replies are excluded and there is no revision policy. Events after fieldwork closes are missed.

What moves BoE Credit Conditions Survey?

Moves come from 4 lending blocks plus the reasons lenders give for supply shifts.

• Secured lending: property backed household loans covering supply, demand, loan terms, defaults and loss per default.
• Credit card lending: availability, demand and card terms such as rates, limits, approvals and defaults.
• Other unsecured lending: personal loans with no collateral, covering availability, demand, loan terms and defaults.
• Corporate lending: business loans by firm size and non-bank financial firms, covering pricing, loan terms, defaults and loss per default.
• Supply drivers: economic outlook, market share objectives, risk appetite, funding costs and wholesale funding strain.

The round published on 16 July 2020 shows why household and business blocks must be read separately. Fieldwork ran from 1 June to 19 June 2020. Unsecured household supply fell to -63.3, driven by a changing economic outlook of -64.1 and changing risk appetite of -38.9.

Scoring tightened for credit cards to -46.8 and for other unsecured loans to -73.8, while card approvals fell to -70.0. In the same quarter corporate credit supply rose for all firm sizes, helped by government support schemes. Household demand fell as business demand rose, then business demand was expected to fall.

How is BoE Credit Conditions Survey calculated?

1. Five point answers: each lender answers up a lot, up a little, same, down a little or down a lot, or N/A. Past and expected balances are scored separately for each question.
2. Scores: a lot counts double a little, so answers map to 2, 1, 0, -1 or -2 by direction.
3. Market share weights: flows weight secured and unsecured loans, while stocks weight corporate loans. Individual weights are unpublished.
4. Net percentage balance: the balance equals 100 times the weighted sum divided by twice total weight, scaled from -100 to 100. For example, 4 lenders weighted 40, 30, 20 and 10 answer 2, 1, 0 and -1. The weighted sum is 100 over twice total weight 200, giving a balance of 50, read as an increase.
5. Seasonal handling: the Bank applies no seasonal adjustment. Lenders allow for normal seasons, such as Christmas effects on unsecured demand.
6. Reading rules: zero splits net rise from net fall. Moves above 10 count as change, 5 to 10 as slight and below 5 as unchanged. There is no policy target or trigger line. Reports up to 2019 Q2 called moves above 20 significant.

Key point: figures reflect lender views, not Bank views or loan volumes, and expected change is not a realised outcome. Unchanged means flat on the prior 3 months, even when conditions stay tight or loose over longer trends.