The market financing of non-financial corporations growth continued in December
The market financing of non-financial corporations growth continued in December (+6.8% over one year, after +6.6% the previous month). Bank financing growth rate decreased (+5.0%, down from +5.9%). Overall, the annual growth rate of financing of non-financial corporations remained dynamic at +5.6%, after +6.2%.
In 2019, the average 5-year cost of non-financial corporations market financing decreased by 74 basis points and reached 0.82% in December 2019.
Annual growth rate, by type of financing (in %)
Average cost of financing (in %)
Source and calculations : General Directorate of Statistics, Economics and International
Composition of non-financial corporate debt
The average cost of bank loans to non-financial corporations is computed using the monthly interest rate applied by French banks. This indicator only covers euro-denominated loans with a term of at least one year and with an initial amount of at least one million euros. It excludes revolving term facilities and overdratfs.
The average cost of market financing is calculated on the basis of month-end actuarial rates of return of alive securities. It only covers euro-denominated securities with an initial maturity longer than one year and with a fixed coupon rate. A specific calibration process using the yield curve is performed to align different maturities with a constant 5-year maturity. The average cost of market financing calculation methodology excludes extreme values.
The average cost of bank loans and the average cost of market financing cannot be directly compared since they often differ in their maturity horizon.
Download the PDF version of this
Financing of non-financial corporations
Published on Monday, February 10, 2020