Being aware of the importance of credit institution lending for the economic development of Latvia and its impact on monetary policy decision-making, the Bank of Latvia has been conducting regular lending surveys of credit institutions with large loan portfolios since 2007. Apart from disclosing additional information about the financing activities of credit institutions, the results of these surveys give a better idea of lending trends and reasons underlying changes in them; they likewise help develop a better understanding of economic growth prospects. The main objectives of credit institution lending survey are:
1) to get additional information on credit markets with regard to both resident enterprise (non-financial corporations) and resident private (households) sectors;
2) to identify changes in credit institution lending standards and terms and conditions;
3) to examine information about various factors that affect the loan demand and supply;
4) to obtain information as to credit institutions' plans to change their lending standards in the foreseeable future and about eventual shifts in the demand for financing;
5) to probe into problems related to the development of lending and affecting the Latvian economy.

The Bank of Latvia conducts credit institution surveys on a semi-annual basis (in January and July), asking credit institutions to provide answers to questions about the changes in lending during the recent half-year and their expectations for the current half-year. The regular survey base of respondents consists of 9-10 credit institutions and foreign bank branches.

Responses to the survey questionnaire reflect the assessment by credit institutions' leading loan specialists. Aggregated responses from credit institutions indicate the direction of changes. Net percentage of credit institutions or the difference between the number of credit institutions reporting a change in one direction and those reporting a change in the opposite direction is the indicator of change. The weight of loan portfolio of each credit institution is not accounted for in this calculation.

Example. Aggregated responses of 10 credit institutions comprise two tightened considerably, three tightened somewhat, one remained basically unchanged, three eased somewhat, and one eased considerably reports. Consequently, net percentage of credit institutions reporting tightening lending standards is equal to (2 + 3 - 3 - 1) : 10 x 100 = 10%. Forecast is net percentage of credit institutions calculated from the survey responses about the credit institutions' assessment for the current half-year period.