Irish banks expect the "biggest ever decrease" in the demand for mortgages and consumer loans as a result of the impact of the Covid-19 pandemic.
That is one of the results from analysis of the quarterly Bank Lending Survey published by the Central Bank today.
The Central Bank said the fall in demand will be greater than during the financial crisis a decade ago.
Banks expect there will be a slight increase in demand for credit overall coming from firms, but more firms are expected to look for short-term credit and fewer of them will borrow for long-term investment.
The survey was conducted from March 19 to April 3 and is carried out across the euro zone.
Irish banks reported that the demand for credit was stable in the first three months of the year but that changes over the next three months will be substantial and dramatic.
It is expected that credit standards for households will become more stringent and "close to levels observed at the height of the financial crisis," the Central Bank stated.
The reason for this is a change in banks' perception of risk due to the general economic situation and borrowers' creditworthiness.
But the survey noted that banks are in a better situation than they were during the financial crisis.
It also noted that banks believe recent actions by the European Central Bank will help with the availability of credit and its cost. It will also "support their profitability," the Central Bank added.