Non-financial corporate financing remained dynamic in August
In August, non-financial corporations market debt increased by 13.3% as in the previous month. Bank loans growth remained dynamic at 13.1% over one year. Overall, the annual growth rate of financing of non-financial corporations reached 13.2% in August, after 12.8% in July.
The recent rise in non-financial corporations debt is accompanied by an increase in their cash flow.
The average 5-year cost of non-financial corporations financing decreased by 22 basis points in August.
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.
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Financing of non-financial corporations
Published on Friday, October 9, 2020