Signs of a deterioration in credit quality stem from the trend in loans made to borrowers for whom a significant increase in credit risk was observed (classified as ‘Stage 2’ according to international accounting standards), which at the end of March had reached 10.3 per cent of the total, compared with 8.7 per cent at the end of 2019.
Nevertheless, the current buffer calibrations prevent them from being used countercyclically throughout the cycle. The limited size of the CCyB calibrations restricts the possibility for releasing it to support lending to the real economy if the cycle turns. As macroprudential authorities, we are therefore continuing to review the implementation and scope of the available instruments.