Financing of non-financial corporations 2020Jun

Bank and market debt continued to grow in June
The debt of non-financial corporations continued to increase in June (+13% over one year after +12% the previous month). Market financing, mainly driven by issues in euros, increased by 14.7% over one year, a pace already recorded at the end of 2012. The annual growth rate of credit lending reached 12.1%. The recent acceleration in debt is accompanied by an increase in the sector's bank deposits. After peaking its higher point in March, the average 5-year cost of non-financial corporations market financing decreased by 30 basis points, going down from 1.58% in May to 1.28% in June.
Financing of non-financial corporations
(Gross stocks and flows in billions of euros, growth rate and interest rate in %)
Outstanding amount Annual net issuance Annual growth rate Average cost of new financing (monthly average)
Jun-2020 Jun-2020 May-2020 Jun-2020 May-2020 Jun-2020
Financing of NFCs 1,866 216 12.0 13.0 1.15 1.22
- Of which : bank loans 1,170 126 11.6 12.1 0.90 1.18
- Of which : market financing 696 89 12.7 14.7 1.58 1.28
in euros 586 85 14.7 17.0
in currencies 110 4 3.7 3.8
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
Non-financial corporate debt in this « Stat Info » refers to debt securities issues (bonds and negotiable debt securities) subscribed by residents and non-residents as well as to the credits granted by resident credit institutions.

Negotiable debt securities include short-term commercial papers (less than one year) and medium-term negotiable notes. Further details on loans to non-financial corporations is available in the « Stat Info » referring to loans to non-financial corporations :

Overall non-financial corporate debt also includes bank loans from non-resident credit institutions. This measure can be found in the « Stat Info » related to non-financial sector 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.

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Financing of non-financial corporations STAT INFO - June 2020
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Financing of non-financial corporations
  • Published on 08/11/2020
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Published on Tuesday, August 11, 2020