The Bank of Israel published findings showing that demand for business credit continued to decline in the third quarter of 2026, including in construction and real estate, while demand for housing and consumer credit was unchanged. Banks reported tighter margins on risky credit to large businesses and the construction and real estate industries. Margins eased on nonrisky credit to small, micro and medium businesses and continued to ease on nonrisky consumer credit.
Competitive pressures remained the main factor behind the easing of credit margins. Housing credit margins were unchanged. Banks expect business credit demand, including in construction and real estate, to decline further in the fourth quarter of 2026. Housing credit demand is expected to increase, while consumer credit demand is expected to remain stable.