Euro zone banks tightened their standards for granting home mortgages and expect to continue to do so this quarter, a European Central Bank survey showed on Tuesday.

A net 4 per cent of banks surveyed by the ECB reported a tightening of their internal guidelines as to who should get loans for house purchases.

The net tightening was mainly related to the implementation of the EU mortgage credit directive, which requires banks to carry out a deeper assessment of borrowers, and to a slightly lower tolerance of risk.

Among the euro zone’s largest economies, banks in the Netherlands and Germany tightened conditions while their counterparts in Italy and Spain eased them.

Euro area banks expect a continued net tightening of credit standards in the second quarter of 2016.

Reuters